Availability Formulas

MINE DEVELOPMENT ASSOCIATES
MINE ENGINEERING SERVICES
Technical Report
Black Fox Project
Matheson, Ontario Canada
Prepared for:
APOLLO GOLD CORPORATION

August 14, 2006
Neil B. Prenn, P. Eng.
775-856-5700
210 South Rock Blvd.

Reno, Nevada 89502
FAX: 775-856-6053
TABLE OF CONTENTS
Section Page
1.0 EXCUTIVE SUMMARY ............................................................................................................... 1

1.1 Introduction ......................................................................................................................... 1
1.2 Geology and Mineralization ................................................................................................ 2
1.3 Drilling and Sampling ......................................................................................................... 4
1.4 Metallurgical Testing and Processing ................................................................................. 6
1.5 Black Fox Resource Estimate.............................................................................................. 7
1.6 Black Fox Project Reserves............................................................................................... 15
1.7 Capital Cost Estimate ........................................................................................................ 19
1.8 Operating Cost Estimate....................................................................................................20
1.9 Project Economics ............................................................................................................. 21
1.10 Recommendations ............................................................................................................. 24
2.0 INTRODUCTION AND TERMS OF REFERENCE................................................................... 26
3.0 RELIANCE ON OTHERS ............................................................................................................ 30

3.1 Land................................................................................................................................... 30
3.2 Permitting .......................................................................................................................... 30
3.3 Geotechnical Report .......................................................................................................... 30
3.4 Processing.......................................................................................................................... 30
4.0 PROPERTY DESCRIPTION AND LOCATION......................................................................... 31

4.1 Location............................................................................................................................. 31
4.2 Land Area .......................................................................................................................... 31
4.3 Mining Claim Description................................................................................................. 32
4.4 Agreements and Encumbrances ........................................................................................ 32
4.5 Environmental Liabilities ..................................................................................................37
4.5.1 Permitting .............................................................................................................. 37
5.0 ACCESS; CLIMATE; LOCAL RESOURCES; INFRASTRUCTURE; AND

PHYSIOGRAPHY ........................................................................................................................ 41
5.1 Access................................................................................................................................ 41
5.2 Climate .............................................................................................................................. 41
5.3 Local Resources and Infrastructure ................................................................................... 41
5.4 Physiography ..................................................................................................................... 41
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Reno, Nevada 89502
FAX: 775-856-6053
Technical Report, Black Fox Project
Apollo Gold Corporation Page ii
6.0 HISTORY...................................................................................................................................... 42
6.1 Exploration History ........................................................................................................... 42
6.2 Production History............................................................................................................. 42
6.3 Historic Resource Estimates.............................................................................................. 43
6.4 Historic Reserve Estimates................................................................................................ 43
7.0 GEOLOGIC SETTING ................................................................................................................. 46

7.1 Regional Geology.............................................................................................................. 46
7.2 Local Geology ................................................................................................................... 46
8.0 DEPOSIT TYPE............................................................................................................................ 53
9.0 MINERALIZATION..................................................................................................................... 54
10.0 EXPLORATION ........................................................................................................................... 56
11.0 DRILLING .................................................................................................................................... 59

11.1 Drilling Summary.............................................................................................................. 59
11.2 Historic Diamond Drilling and Logging ........................................................................... 59
11.3 Apollo Diamond Drilling and Logging ............................................................................. 60
12.0 SAMPLING METHOD AND APPROACH................................................................................. 64

12.1 Summary............................................................................................................................ 64
12.1.1 Black Fox Deposit Sampling Issues ...................................................................... 64
12.2 Noranda Sampling ............................................................................................................. 65
12.3 Exall Sampling .................................................................................................................. 66
12.3.1 Exall Diamond Drilling ......................................................................................... 66
12.3.2 Underground Mine Sampling ................................................................................ 66
12.3.3 Exall Assay Lab Procedures.................................................................................. 68
12.4 Apollo Gold Sampling....................................................................................................... 68
12.5 Sample Statistics................................................................................................................ 68
12.6 Sample Distribution........................................................................................................... 70
13.0 SAMPLE PREPARATION, ANALYSIS, AND SECURITY...................................................... 71

13.1 Summary............................................................................................................................ 71
13.2 Sample Security................................................................................................................. 71
13.3 Drill Sample Preparation and Analysis .............................................................................71
13.3.1 Noranda Drill Sample Preparation and Analysis...................................................71
13.3.2 Exall Drill Sample Preparation and Analysis........................................................ 72
13.3.3 Apollo Drill Sample Preparation and Analysis ..................................................... 72
13.3.4 Exall Chip Sample Preparation and Analysis........................................................73
13.4 QA/QC, Check Samples, Check Assays ........................................................................... 73
13.4.1 Summary................................................................................................................ 73
13.4.2 Noranda Check Assays.......................................................................................... 74
13.4.3 Exall Check Sampling ........................................................................................... 75
13.4.4 Apollo Check Assaying......................................................................................... 77
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13.4.4.1 Metallic Check Assays ....................................................................... 77

13.4.4.2 Standards and Blanks ......................................................................... 77
13.4.4.3 Check assays on sample pulps ........................................................... 80
13.4.4.4 Checks on Sample Rejects ................................................................. 81
13.4.4.5 Mini Bulk Sample Checks.................................................................. 82
14.0 DATA VERIFICATION ............................................................................................................... 84
15.0 ADJACENT PROPERTIES.......................................................................................................... 85
16.0 MINERAL PROCESSING AND METALLURGICAL TESTING ............................................. 87

16.1 Summary............................................................................................................................ 87
16.2 Initial Metallurgical Testwork (1996) ............................................................................... 89
16.3 Stock Mill Operations (1996-1999)................................................................................... 92
16.4 Macassa Mill Operations (1999-2001).............................................................................. 93
16.5 Metallurgical Testwork (1999).......................................................................................... 95
16.6 2006 Mini Bulk Sample Gravity Tests .............................................................................. 97
16.7 Implications of Test Data and Empirical Results on Conceptual Plant Design ................ 97
16.8 Gold Recovery Projections................................................................................................ 98
17.0 MINERAL RESOURCE ESTIMATE ..........................................................................................99

17.1 Definitions ......................................................................................................................... 99
17.2 Data.................................................................................................................................. 100
17.3 Density............................................................................................................................. 100
17.4 Black Fox Geologic Model ............................................................................................. 102
18.0 MINERAL RESERVE ESTIMATE ...........................................................................................115

18.1 Geotechnical Bedrock Pit Slope Studies ......................................................................... 115
18.2 Black Fox Overburden Slopes, Waste and Overburden Stockpiles ................................120
18.2.1 Overburden Slopes .............................................................................................. 120
18.2.2 Waste Rock Stockpile.......................................................................................... 121
18.2.2.1 Waste Rock Characterization ........................................................... 121
18.2.2.2 Waste Rock Stockpile Design .......................................................... 122
18.2.3 Overburden Stockpile.......................................................................................... 123
18.3 Black Fox Deposit Pit Optimization................................................................................124
18.4 Black Fox Pit Design....................................................................................................... 125
19.0 OTHER RELEVANT DATA AND INFORMATION............................................................... 130
20.0 INTERPRETATION AND CONCLUSIONS ............................................................................131
21.0 RECOMMENDATIONS ............................................................................................................ 133

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22.0 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT

PROPERTIES AND PRODUCTION PROPERTIES.................................................................136
22.1 Site Map........................................................................................................................... 136
22.2 Production Schedule........................................................................................................ 136
22.3 Mining ............................................................................................................................. 136
22.3.1 Glacial Till........................................................................................................... 138
22.3.2 Waste Mining Away From Mineralized Areas ...................................................140
22.3.3 Mining in the Mineralized Areas......................................................................... 140
22.4 Mine Productivity............................................................................................................ 140
22.4.1 Drilling and Blasting ........................................................................................... 140
22.4.2 Loading Productivity ........................................................................................... 143
22.4.3 Truck Productivity............................................................................................... 144
22.5 Processing........................................................................................................................ 145
22.5.1 Owner Milling Option ......................................................................................... 146
22.5.2 Processing Design Assumptions.......................................................................... 153
22.5.3 Tailings Design.................................................................................................... 157
22.5.3.1 Tailings Dam Design Considerations............................................... 157
22.5.3.2 Closure Considerations .................................................................... 163
22.5.4 Toll Milling Option ............................................................................................. 163
22.6 Infrastructure ................................................................................................................... 163
22.6.1 Access.................................................................................................................. 163
22.6.2 Power Distribution............................................................................................... 163
22.6.3 Water Distribution ............................................................................................... 164
22.6.4 Administration Building...................................................................................... 164
22.6.5 Truck Shop and Offices....................................................................................... 164
22.6.6 Pit Office ............................................................................................................. 164
22.7 Permitting ........................................................................................................................ 164
22.8 Manpower........................................................................................................................ 164
22.9 Black Fox Capital Cost Estimate..................................................................................... 168
22.10 Black Fox Operating Cost Estimate ................................................................................ 175
22.11 Black Fox Pre-tax Economics ......................................................................................... 183
23.0 REFERENCES ............................................................................................................................ 186
24.0 AUTHOR’S CERTIFICATE ......................................................................................................189

Apollo Gold Corporation Page v
LIST OF TABLES
Table Page
Table 1.1 Historic Black Fox Production ...............................................................................................2
Table 1.2 Black Fox Property Drill Summary........................................................................................4
Table 1.3 Mineralized Zone Domains and High Grade Cut...................................................................9
Table 1.4 Indicated Material.................................................................................................................11
Table 1.5 Black Fox Deposit Resource Estimate .................................................................................12
Table 1.6 Model prediction of Mined Material ....................................................................................14
Table 1.7 Black Fox Inferred Material .................................................................................................15
Table 1.8 Black Fox Inferred Resource................................................................................................15
Table 1.9 Black Fox Pit Optimization Results .....................................................................................16
Table 1.10 Black Fox Proven and Probable Reserves............................................................................17
Table 1.11 Black Fox Capital Cost Estimate..........................................................................................20
Table 1.12 Black Fox Open Pit Production Schedule ............................................................................20
Table 1.13 Black Fox Project Manpower Requirements (Base Case) ...................................................21
Table 1.14 Black Fox Operating Cost Estimate .....................................................................................21
Table 1.15 Pre-tax Economic Evaluation Summary ..............................................................................22
Table 4.1 Current Black Fox Project Property Summary.....................................................................31
Table 6.1 Black Fox Project – Production History...............................................................................42
Table 6.2 Historic Resource Estimates.................................................................................................43
Table 6.3 Historic Reserve Estimates...................................................................................................43
Table 11.1 Black Fox Property Drill Summary......................................................................................59
Table 11.2 Black Fox Property Database Summary...............................................................................59
Table 12.1 Sample Statistics by Company in Mineralized Zones..........................................................69
Table 12.2 Sample Statistics by Company outside of Mineralized Zones .............................................69
Table 15.1 Reported Reserves From Selected Mines Along the DPFZ. ................................................85
Table 15.2 Reported Resources From Selected Mines Along the DPFZ ...............................................86
Table 16.1 Historical Plant Performance................................................................................................88
Table 16.2 Gold Head Analyses for the Composite Samples, (g Au/t ).................................................90
Table 16.3 Summary of Gravity Concentration Test Results.................................................................90
Table 16.4 Summary of Cyanidation Test Data .....................................................................................91
Table 16.5 A Summary of Macassa Production Data ............................................................................94
Table 16.6 Comparison of Head Values (g/t Au), January to March Inclusive 2001 ............................95
Table 16.7 1999 Test Program Sample Description...............................................................................96
Table 17.1 Black Fox Densities............................................................................................................100
Table 17.2 Mineralized Zone Domains and High Grade Cut...............................................................103
Table 17.3 Composite Statistics by Zone .............................................................................................104
Table 17.4 Grade Model Statistics .......................................................................................................107
Table 17.5 Indicated Material Contained in the Mineralized Zones at Different Cutoff Grades.........109
Table 17.6 Indicated Material Contained Model Using Different Pass 1 Search Distances ................110
Table 17.7 Black Fox Deposit Resources.............................................................................................111
Table 17.8 Model Estimate of Mined Material ....................................................................................112
Table 17.9 Black Fox Inferred Material at Different Cutoff Grades....................................................113
Table 17.10 Black Fox Inferred Resource..............................................................................................114
Table 18.1 Pit Slopes For Optimization ...............................................................................................125
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Table 18.2 Pit Optimization Results.....................................................................................................125

Table 18.3 Pit Design Summary...........................................................................................................126
Table 18.4 Probable Black Fox Reserves.............................................................................................126
Table 18.5 Base Case Production Schedule .........................................................................................127
Table 19.1 Exall Reported Cash Costs .................................................................................................130
Table 22.1 Black Fox Production Schedule (Owner Milling)..............................................................136
Table 22.2 Montana Tunnels Mine Equipment ....................................................................................137
Table 22.3 Drill and Blasting Assumptions (1)....................................................................................141
Table 22.3a Drill and Blasting Assumptions (2)....................................................................................142
Table 22.4 Black Fox Loading Productivity ........................................................................................143
Table 22.5 Black Fox Hauling Parameters ...........................................................................................144
Table 22.6 Estimated Truck Productivity.............................................................................................145
Table 22.7 Owner Milling Assumptions ..............................................................................................153
Table 22.8 Black Fox Manpower – Base Case.....................................................................................165
Table 22.9 Black Fox Mine Hourly Labor Requirements ....................................................................165
Table 22.10 Black Fox Mine Salaried Staff Labor Requirements .........................................................166
Table 22.11 Process Plant Manpower (Base Case) ................................................................................167
Table 22.12 Administrative Personnel ...................................................................................................167
Table 22.13 Estimated Capital Cost – Owner Milling ...........................................................................170
Table 22.14 Estimated Capital Cost – Toll Milling................................................................................171
Table 22.15 Estimated Mine Equipment Capital Cost ...........................................................................172
Table 22.16 Owner Processing Plant Capital Cost Estimate..................................................................174
Table 22.17 Black Fox Project Estimated Operating Cost Estimate ......................................................175
Table 22.18 Processing Operating Supplies ...........................................................................................176
Table 22.19 Estimated Operating Cost of Toll Milling..........................................................................177
Table 22.20 Estimated Black Fox Mine Operating Cost (Owner Mill) .................................................178
Table 22.21 Estimated Black Fox Mine Staff Costs ..............................................................................178
Table 22.22 Estimated Black Fox Mine Hourly Employee Costs..........................................................179
Table 22.23 Mine Equipment Estimated Costs ......................................................................................180
Table 22.24 Mine Operating Cost Estimate Detail.................................................................................181
Table 22.25 Estimated Process Operating Cost – Owner Milling Case.................................................182
Table 22.26 Estimated General and Administrative Costs.....................................................................183
Table 22.27 Pre-tax Economic Evaluation Summary ............................................................................184
LIST OF FIGURES
Figure Page
Figure 1.1 Site Plan................................................................................................................................18
Figure 1.2 Sensitivity of Pre-tax Cash Flow..........................................................................................23
Figure 1.3 Sensitivity of Pre-tax Internal Rate of Return ......................................................................23
Figure 4.1 Black Fox Location Map ......................................................................................................34
Figure 4.2 Adjacent Mines Location Map .............................................................................................35
Figure 4.3 Black Fox Claim Map ..........................................................................................................36
Figure 6.1 Underground Views..............................................................................................................45
Figure 7.1 Regional Geology.................................................................................................................48
Figure 7.2 Local Geology ......................................................................................................................49
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Figure 7.3 Typical Cross Section 10025E .............................................................................................50

Figure 10.1 Apollo Geophysical Survey..................................................................................................58
Figure 11.1 Surface Drill Plan .................................................................................................................62
Figure 11.2 Underground Drill Hole Plan Map .......................................................................................63
Figure 12.1 Horizontal Chip Sampling....................................................................................................66
Figure 12.2 Vertical Chip Sampling ........................................................................................................67
Figure 12.3 QQ Plot of Drill Programs....................................................................................................70
Figure 13.1 Swastika or Chemex Lab Sample Preparation and Assaying Procedure for Noranda .........72
Figure 13.2 Noranda ½ Assay Ton Reruns..............................................................................................74
Figure 13.3 Noranda 1 Assay Ton Reruns...............................................................................................75
Figure 13.4 Comparison of 365 Muck Samples Checked by Techni-Lab...............................................76
Figure 13.5 Macassa Mill Checks on Chip and Muck Samples ..............................................................76
Figure 13.6 Apollo Metallic Check Assays .............................................................................................77
Figure 13.7 Apollo Blank Check Assays.................................................................................................78
Figure 13.8 High-Grade Standard............................................................................................................79
Figure 13.9 Low-Grade Standard ............................................................................................................79
Figure 13.10 Sample Pulp Checks – First Rerun ......................................................................................80
Figure 13.11 Original Assay vs Check Assay From Sample Rejects........................................................81
Figure 13.12 Relative Difference - Original Assay vs Check Assay From Sample Rejects.....................82
Figure 13.13 Mini-Bulk Sample Gravity Test Results..............................................................................83
Figure 16.1 Gold Recoveries vs. Feed Grades.........................................................................................98
Figure 17.1 Apollo Density Testing – Mineralized Material.................................................................101
Figure 17.2 Apollo Density Testing – Non-mineralized Material.........................................................101
Figure 17.3 Black Fox Variograms: All Composites From Domains 4, 7, 9, 11, and 13......................105
Figure 17.4 Grade Model Distribution...................................................................................................108
Figure 18.1 Slope Design Elements.......................................................................................................118
Figure 18.2 Bench Geometry and Inter-ramp Angle .............................................................................119
Figure 18.3 Black Fox Phase 1 Pit Design ............................................................................................128
Figure 18.4 Black Fox Project Final Pit Design ....................................................................................129
Figure 22.1 Site Map..............................................................................................................................139
Figure 22.2 Sensitivity of Pre-tax Cash Flow........................................................................................185
Figure 22.3 Sensitivity of Pre-tax Internal Rate of Return ....................................................................185
APPENDICES
Appendix A Proposed Mill Drawings
Appendix B Pitard Reports

1.0 EXCUTIVE SUMMARY
This report was prepared at the request of Apollo Gold Corporation (Apollo). Apollo purchased 100%
interest in the Glimmer Mine property from Exall Resources Ltd. (Exall), and Glimmer Resources
(Glimmer), completing the transaction during September, 2002. The Glimmer Mine Joint Venture was
owned 52% by Exall and 48% by Glimmer. Apollo changed the name of the property to Black Fox.
The purchase involved payment of CND $3,159,000 and 2.08 million shares of Apollo Gold
Corporation to the joint venture. An additional cash payment of CND $3 million was made in January,
2006. The purchased property is not subject to any production royalties or encumbrances, however a
bond of CDN $675,000.00 has been supplied to the Ministry of Northern Development and Mines for
future site remediation at the Black Fox Mine Site. The adjacent Ewen property was purchased in
November, 2003 for CDN$180,000 and is subject to a 3% NSR royalty (CDN$500 annual minimum
royalty).
The purpose of this report is to provide technical support for Apollo’s resource and reserve statements
for the Black Fox property and to satisfy Apollo’s obligation to file a technical report to be made
available to the public.
The technical report was written in compliance with disclosure and reporting requirements set forth in
the National Instrument 43-101. The resources for the Black Fox deposit are based on all drilling
through the end of 2005 and were calculated by Mine Development Associates (MDA). Apollo
completed a total of 449 surface diamond drill holes totaling 136,391.6 m and 321 underground
diamond drill holes totaling 75,704.5 m since purchasing the property. The Apollo drilling supplements
the 245 surface drill holes and 721 underground drill holes drilled by prior owners. This report
summarizes a pre-feasibility study completed by MDA during 2006 that indicated an economic project
and developed open pit reserves for the property based on a gold price of $US550 per ounce.
1.1 Introduction
The Black Fox property is located about 10 km east of the town of Matheson, Ontario, Canada, along
the east-west trending 200 km Destor-Porcupine Fault Zone. Many of Ontario’s gold mines are along
this structure. The mines along this structure near Timmins have produced about 70 million ounces of
gold. The Glimmer underground gold mine operated on the Black Fox property over the period 1997-
2001, and produced about 211,000 ounces of gold by contract milling in either the Saint Andrews or
Macassa mills, as shown in Table 1.1.
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Table 1.1 Historic Black Fox Production

Actual Reported Production
Year Tonnes Grade Ounces Au Gold Recovery
000's g Au/t 000's %
1997 194.5 6.79 39.9 96.38%
1998 308.7 6.67 64.3 96.90%
1999 258.7 5.82 48.3 97.76%
2000 255.2 5.82 46.4 97.04%
2001 81.7 4.81 11.9 98.19%
Totals 1,098.8 5.97 210.8 97.14%
Noranda Exploration Company, Ltd. (Noranda) and Glimmer Resources explored the property during
the late 1980s. With the aid of geophysical targets Noranda discovered gold mineralization in 1989.
Noranda completed 143 surface drill holes by 1995 when Exall Resources Ltd. (Exall) purchased
Noranda’s portion of the property. Exall continued to explore by completing an additional 142 surface
drill holes. A feasibility study of the project was commissioned in 1996, and the property was
developed during 1997 and placed into production during 1998. Exall mined portions of the deposit to
about 200-250 m below the surface before suspending operations in May of 2001. Exall completed 720
underground diamond drill holes during this period.
Apollo purchased the property from the Exall-Glimmer joint venture in 2002 and began exploration of
the property in 2003. Through the end of 2003, Apollo has completed 296 surface diamond drill holes
totaling about 82,895 m of drilling. The Apollo program has intersected significant gold mineralization
in both near-surface drilling, and down-dip of the area mined by Exall, as well as along strike.
The pre-feasibility study presented in this report investigated the economics at a 1,500 tpd ore
production rate, based on the options of either owner or toll milling.
Golder Associates completed a preliminary assessment of open pit slopes and a preliminary design.
AMEC followed up with a geotechnical study of the overburden slopes, waste stockpiles, and tailings
impoundment, should a mill be constructed.
1.2 Geology and Mineralization
The Black Fox project is located in the Destor-Porcupine Fault Zone (DPFZ) which is a major structural
feature traceable for at least 200 km east of Timmins, Ontario. The DPFZ is host to a number of major
gold deposits including Holt-McDermott, Holloway, Pamour, Dome, McIntyre, and Hollinger Mines. In
the Black Fox area the DPFZ consists of a series of faults that transect lithologies of the Archean
Kinojevis Group and Stoughton-Roquemaure Group volcanic rocks. At the Black Fox property the
package of deformed strata and shear zones strike roughly northwest-southeast and dip to the southwest
at about 40 degrees near the surface and, in places, get steeper with depth.
The mineralization at Black Fox is generally restricted to an ankerite alteration zone of 20-100 m in
thickness. At least 15 zones of mineralization have been identified within the zone of ankerite

alteration, which have been grouped into 5 main zones. Two of the main auriferous zones are located at
the hanging wall contact and at the footwall contact. Numerous syenitic and feldspar +/- quartz
porphyry sills and dykes of various ages occur, primarily within the main ankerite alteration zone. They
are commonly massive to brecciated, silicified and pyritic with occasional sericite and hematite
alteration and a more common black chlorite alteration at the contacts. Some mineralization can also be
found in intrusive dikes that cut across the mineralized zones.
This mineralized envelope occurs primarily within komatiitic ultramafics and lesser mafic volcanics
within the outer boundaries of the DPFZ. The auriferous zones have several modes of occurrence, from
concordant zones which follow lithological contacts and which have been subsequently deformed, to
slightly discordant ones which are associated with syenitic sills and quartz veins or stockworks.
The three main types of gold mineralization noted at Black Fox are:
1. Low-sulfide mineralization associated with significant quartz veining and quartz stockwork
within strong ankerite + fuchsite alteration of ultramafic volcanic units. “Green carbonate ore” is
included in this type. While characterized by low-sulfide contents, small amounts of pyrite are
typical of the mineralized zones. Multiple phases of quartz veining and structural episodes,
evidenced by cross-cutting veins, chloritic slip surfaces in the quartz veins, and breccia textures,
are typical of this mineralization style. Visible gold is common in high-grade areas. Without
visible gold, however, it is often difficult to predict significantly mineralized versus
unmineralized intervals. This type of mineralization is most common in the footwall portion of
the Destor-Porcupine fault zone (“DPFZ”).
2. Mineralization hosted within mafic volcanic units that is associated with significant fine-grained
pyrite (typically >~5%) and minor to moderate quartz veining. Quartz veins are typically
parallel to foliation, and visible gold is characteristically absent in this type of mineralization,
referred to in the district as ‘flow ore’. The mineralization is frequently, but not always,
associated with bleaching of the mafic volcanic rocks. This style is common in the footwall
portion of the DPFZ in the eastern part of the 235-level underground drilling.
3. Mineralization hosted in silicified felsic dikes. The host dikes include both quartz-feldspar
porphyries and finer-grained, possibly syenitic, dikes (FI code); the fine-grained dikes are more
commonly mineralized. Mineralization in the dikes is associated with increased silicification,
fracturing, and pyrite; some quartz veining is typically present. Dike-hosted mineralization is
common in the middle and hanging wall portions of the DPFZ, where dike intersections can be
correlated from hole to hole in many cases (in contrast to the blocks and lenses of felsic dikes
that occur in the footwall portions of the DPFZ).
The ankerite alteration zones are thicker in the western and eastern portions of the deposit. In addition,
the zones appear to thicken near the surface and with depth. The mineralized zones appear to be open at
depth and to the east and west.

1.3 Drilling and Sampling
All of the drilling on the property has been diamond drilling with mostly NQ size core. A total of
324,624.6 m of drilling has been completed on the property. Table 1.2 summarizes the drilling on the
property.
Table 1.2 Black Fox Property Drill Summary
Company Period Type Number Meters

(All Core)
Noranda 1989-1994 Surface 143 28,180.8
Exall 1995-1999 Surface 142 21,288.7
Apollo 2002-2005 Surface 449 136,391.6
Subtotal Surface 734 185,861.0
Exall 1996-2001 Underground 721 63,059.2

Apollo 2004-2005 Underground 371 75,704.5
Subtotal Underground 1,092 138,763.6
Total Black Fox 1,826 324,624.6
The sample prepared on the Noranda core included splitting the core with Noranda initially preparing a
½ assay ton pulp (15-20 gram). Noranda reassayed 1 assay ton pulps if the initial assay was in excess of
2 g Au/t. Generally the fire assay was completed with a gravimetric finish. Both Exall and Apollo split
the core and prepared a 1 assay ton pulp and completed a fire assay, generally with gravimetric finish.
Limited check assay data is available for the programs completed by Noranda and Exall. Apollo
completed a program of regular check assays with standards and blanks submitted with each batch of
assays.
A total of 8,721 Apollo sample pulps have been rerun by the original assayer and recorded in the
database as rerun1. An additional 685 and 149 have been recorded as rerun2 and rerun3 respectively.
These rerun samples show good agreement with the original assay.
A total of 2,618 assay intervals have been checked by a different lab by preparing an additional sample
from the original sample rejects. An additional 664 were checked a second time. In general, these
samples show reasonably good agreement with the original sample, but also show the difficulties in
preparing and assaying samples with coarse gold.
Screen metallic assays have been completed for 595 samples, with the screen metallics showing a 17%
increase in grade over the original fire assays. A significant portion of the samples selected for screen
fire assays are high-grade intervals. MDA believes that if the distribution of the samples selected for
screen fire matched the distribution of the mineralized zones, the improvement in grade may be more
than is shown in the samples to date.

During 2006 Apollo completed a series of large gravity tests on core intervals that had been previously
sampled that were sometimes mixed with the sample rejects. The samples were typically made up of 9
or 10 assay intervals with a total weight between 10 and 16 kg. An average of 59% of the calculated
head of the samples reported to the gravity concentrate. These tests showed a 9% lower grade from the
gravity calculated head grade compared the head grade predicted by prior assays weighted by sample
weights. MDA believes that the reason for the lower grade found by gravity concentration is due to the
distribution of the samples tested. Most of the gravity samples contained more high-grade material than
is normal for the deposit. In testing high-grade material, it is more likely that the small 30 gram sample
originally assayed contained more gold than the total sample, especially if it was one of the larger coarse
particles. In addition, a number of sample intervals were from material that was not in a mineralized
zone. Further, we believe that if the gravity samples had the distribution of the deposit mineralized
zones, the tests would likely show a higher grade than the drill hole assays. Seven gravity tests were
completed on material that was completely outside of the mineralized zones which indicated a 1382%
increase in grade by gravity samples compared to the original drill hole samples. More gravity testing is
required to clarify these results.
MDA believes that there are two serious sampling issues with the deposit, both of which are related to
coarse gold in the deposit, and result in samples that contain less gold than is actually present. First, the
occurrence of gold appears to be concentrated in small areas, and is not uniformly distributed locally.
Gold particles up to 0.15 cm have been observed and particles of 0.06 cm are very common (Pitard,
2005). The problem is to obtain a sample that contains a representative amount of gold for the area
sampled. The core holes that form the basis for the resource and reserve estimate are too small to obtain
a representative sample. Some of the samples will have too much gold in the sample, from hitting the
areas that contain the concentrated gold occurrence. But far more will produce samples that miss the
area of local concentration and will contain less gold than is actually present in the area sampled. They
may even appear to be waste without the concentrated gold. It is likely that several meter diameter holes
would be required to obtain representative samples of the deposit.
The second problem is in preparing and assaying the sample once it has been obtained. The proper
sample size is required in order to get a representative sample again, but this time we have all of the gold
somewhere in the core. With coarse gold it is easy to get samples that contain too many or too few gold
particles if the sample size is not based on the size of the gold particles in the deposit. In order to
sample the 0.15 cm gold particles that occur at Black Fox, samples of up to 109 kg must be processed in
their entirety (Pitard, 2005). If the sample contains 0.06 cm gold particles that commonly occur in the
deposit, than a 6950 g sample must be processed in its entirety (Pitard, 2005). These sample sizes are
much larger than the typical 30 gram fire assay sample or even the 1000 gram (+) screen metallic assay
sample. The same result will happen if the sample size is too small for assay as is the case for sampling
the deposit. A few assays will contain too much gold, but far more will contain less than is actually
present in the whole sample. Francis Pitard’s report on the sampling issues is shown in Appendix B. A
very interesting website with considerable information on coarse gold can be found on the Bendigo Gold
Mine website: http://www.bmnl.com.au . This website contains a number of technical papers regarding
coarse gold.
Without proper size samples the database for the deposit likely contains a few samples that are too high
in grade, but far more that are too low in grade. Francis Pitard concluded in his 2005 report that:
The size of the core samples can account for local geology, but cannot account for the local gold
content: Relative to the size of the coarse gold, the core mass is too small. The resulting effect is
called the In Situ Nugget Effect: It is of the utmost importance for management to understand it.
As a result, Poisson skewness enters the database, leading to a frequent under-estimation of

many ore blocks, and an occasional over-estimation of a few ore blocks.
Such skewness, if carried too far, as I believe is the case, can under-estimate the gold content of
the deposit. However, and this is very important, it is an undeniable fact that the ore reserves are
under-estimated. This is something to keep in mind: Poisson skewness affects the grade
somewhat, but above all, makes a disaster on the estimation of the ore reserves, unless you are
very lucky by having sharp, natural and obvious ore boundaries (e.g., Midas mine in Nevada).
By the time the sample is taken to the laboratory sample preparation, you have already lost its
main purpose which is to be reasonably representative of all gold particle size fractions. Then,
the preparation and assaying procedure, ignoring the potential presence of coarse gold, makes
things even worse, most likely introducing a superimposed secondary Poisson skewness in the
database: At that stage we no longer know what we are doing.
MDA believes that the both the size of the sample to measure the gold in the deposit and the size of the
sample to measure the gold in the sample are too small, and will result in a database where some
samples represent a higher sample grade than is present at the sample location, but many samples
represent too low a grade than is present at the sample location. MDA concurs with Pitard’s conclusion,
that the drill hole data is likely biased and will likely underestimate the contained gold within the
deposit.
1.4 Metallurgical Testing and Processing
About 1.1 million tonnes have been processed by contract mills during the period 1997-2001 recovering
an average of over 97% of the gold based on a calculated head grade. Mine production from the Black
Fox gold project was shipped to the Saint Andrew Goldfields (Stock) mill and the Kinross Gold
Macassa mill during the periods April 1997 – September 1999 and October 1999 – May 2001
respectively.
The mineralization contains disseminated visible gold and is amenable to gravity concentration. The
host rock contains no graphite or cyanide consuming minerals in quantities sufficient to adversely affect
gold recoveries or operating costs.
A program of laboratory and pilot plant metallurgical studies was implemented in 1999 by Lakefield to
examine alternate process options by which overall project economics could be enhanced. Based on
examination of six composite samples of varying grades and sulfide content, the use of spiral
concentrators was deemed to offer a means by which up to 80% of the gold could be recovered in 15%
of the feed weight, given a primary grind of 150μm. The results of these analyses, conducted by
Richard Swider, indicated that the use of a gravity pre-concentration stage, in conjunction with a coarser
primary grind, would be worthy of consideration in any future economic study. The main conclusions
developed by the Lakefield work are outlined below:
The gold mineralization is readily amenable to cyanidation. When grinding in a sodium cyanide
solution, approximately 90% of the gold contained in the mill feed is dissolved by the time the
pulp has exited the cyclone overflow.
The degree of dissolution is dependent on the leach feed grind. Optimum size distribution for
west zone ore appears to be 50 μm while the East Zone mineralization requires grinding 30-40
μm.
The Bond Ball Mill work index of the ore varies within the range of 14-17 kWh/t.
Gold dissolution is relatively insensitive to variations in leach times over the ranges examined.
Black Fox mineralization contains no deleterious elements that could adversely affect operating
efficiencies or the environment.
To varying degrees, Black Fox mineralization is amenable to gravity concentration.
The ground mineralization exhibits favorable settling characteristics.
Exall entered into a three year toll milling agreement with Saint Andrew Goldfields to process Black
Fox mineralization in the Stock mill. The empirical results achieved in the plant confirmed the original
test data.
Upon the expiry of the toll milling arrangement with Saint Andrew Goldfields, Exall shipped the mine
production to the Macassa mill. Metallurgical results continued to confirm the amenability of the Black
Fox mineralization to conventional cyanidation followed by CIP technology. While the higher sulfide
material generated somewhat inferior results and consumed more cyanide, the problems were mitigated
through effective blending of the mill feed. Annual gold recoveries exceeded 97% at the Macassa mill.
In summary, the Black Fox mineralization is free-milling and environmentally innocuous. Although
visible gold is present, relatively fine grinds are required to achieve optimum results. Upside potential
might be realized through the adoption of a gravity circuit in conjunction with a coarser grind. Other
process alternatives should also be included in a series of trade-off studies, prior to finalizing the basis
for a Feasibility Study. In any event, confirmatory testwork should be performed on samples of
mineralization deemed representative of grades and species to be mined in accordance with the new
mine plan.
1.5 Black Fox Resource Estimate
With the exception of the Exall underground drilling, all of the drilling has been oriented perpendicular
to the general east-west strike of the deposit. In the west and east portions of the deposit, many
mineralized zones strike a little off of the east-west general direction at N70oE to N75oE. Based on the
past mining there are places where mineralization has been found that cross-cut the mineralized zones
across strike that would be difficult to define based on the normal drilling orientation.
Cross sections were made perpendicular to the general east-west strike of the deposit showing the
underground workings, drill holes, drill hole rock type and assay. A set of geologic sections were also
completed showing the geology on section. Both sets of sections were completed on 12.5 m intervals.
The mineralized zones were defined by mineralization in excess of 0.2 g Au/t, which is a very distinct
population break on qq (log-log) plots of the assay distribution. These sections were along the surface
and underground drilling fence lines completed on 12.5 m intervals. Some of the sections could not be
drilled as well as desired from the surface due to the proximity of underground workings. A near-
surface high-grade area was drilled on 12.5 m spacing that indicated reasonably good continuity for this
zone. Sometimes the mineralized zones were not drawn of the sections that were on 12.5 m intervals
due to lack of drilling on the sections, with the thought that the mineralized zones could be better
defined by plan view sections in these areas.
The mineralized zones were transferred to plan views on three meter intervals, showing the location of
the zones from the sections, drill hole composite assays, and geologic information. The underground
chip and muck samples were also shown on the plans, but were generally not used to draw the
mineralized shapes in order to reconcile drill predicted mineralization with actual production. The
mineralized zones were digitized and used to define the deposit mineralization. The mineralized zones,
for the most part, appear to be fairly continuous features. In a number of areas drill holes with no grade
were included in the mineralized zones.
The mineralization found inside the main ankerite alteration has been grouped into five mineralized
zones. These zones were numbered from footwall to hanging wall of the alteration zone: 7; 11; 4; 13; 9.
The mineralized zone (9) closest to the hanging wall generally consists of multiple zones of
mineralization. Since the zones merge, it was difficult to be consistent in numbering the zones. There
are no known geological or geochemical features that can differentiate one zone from another, other than
the mineralized footwall zone. Even then, using the footwall zone as a starting point to number the
zones also can create difficulties in properly numbering and connecting the mineralized zones as the
footwall zone is occasionally absent or may contain multiple zones of mineralization. Two wide areas
of mineralization have been defined within the hanging wall of the deposit. With many zones that
appear to merge, widen, and disappear, the odds of properly connecting and numbering the zones are
low.
A block model of the deposit was created using 3 m (along strike), by 2 m (across strike) by 3 m (level
interval) blocks. Three dimensional solids were used to determine if a block was inside a mineralized
zone by block centroid. The deposit is generally covered by 10 to 40 m of glacial till. The top of rock
contact was developed from contouring the top of rock from the surface drill hole intercepts. Blocks
were coded alluvium, workings, and originally had a default of a waste code. Drill hole assays were
composited into one and one half meter composites to estimate the gold grades in the model. The
composites were entirely contained in the mineralized zone.
A statistical study was completed for assays and composites within each of the mineralized zones.
Grade distribution (qq) plots of each mineralized zone were used to determine grade domains for the
data contained in each zone. Each of the mineralized zones contained several grade domains as shown
in Table 1.3. Table 1.3 also shows that if the entire data set was used, the capping and domain ranges
would be higher than each of the individual zones. The result of using the high-grade caps shown in
Table 1.3 is a loss of 26.4% of the contained metal, based on the difference between the capped and
uncapped average grades.
Table 1.3 Mineralized Zone Domains and High Grade Cut
Zone Domain Domain Min Domain Max Domain Cap Domain Median Metal Lost in Zone
g Au/t g Au/t g Au/t g Au/t by cut (%)
2 High Grade 4.5 40.00 40.00 45.33%
2 Pull 1 0.8 4.50 1.53
2 Pull 2 0 0.80 0.2
4 High Grade 7.5 175.00 175.00 25.02%
4 Pull 1 0.7 7.50 1.6
4 Pull 2 0 0.70 0.17
5 High Grade 2 6.50 6.50 32.30%
5 Pull 1 0.7 2.00 1.15
5 Pull 2 0 0.70 0.19
7 High Grade 6 80.00 80.00 17.16%
7 Pull 1 1.3 6.00 2.53
7 Pull 2 0 1.30 0.23
9 High Grade 15 120.00 120.00 17.07%
9 Pull 1 1.3 15.00 2.92
9 Pull 2 0 1.30 0.22
11 High Grade 11 65.00 65.00 27.73%
11 Pull 1 0.7 11.00 2.16
11 Pull 2 0 0.70 0.17
13 High Grade 6 90.00 90.00 30.63%
13 Pull 1 0.5 6.00 1.23
13 Pull 2 0 0.50 0.13
All Zones Total Metal Lost by Cut 26.42%
All Zones High Grade 20 220.00 220.00 20.46%
All Zones Pull 1 2 20.00
Variograms were studied for zones 4, 7, 9, 11, and 13 collectively, as these zones make up the main
portion of the Destor-Porcupine Fault zone. The variograms shown indicate maximum ranges of 55 m
in the dip direction, 35 m along strike, and 17 m in the direction perpendicular to strike and dip,
although most of the spatial relationship between the samples occurs at significantly shorter ranges.
MDA used the results of this variographic study to aid in the determination of the search ranges used in
grade interpolation
The grade model evolved through a number of iterations. Initially a model was developed for 1 x 1 x
1.5 m blocks. This resulted in a grade model that was very awkward to use, containing 700,000,000
blocks. A 2 x 3 x 3 model was compared to the 1 x 1 x 1.5 with the resulting blocks showing essentially
no difference on the contained mineralization. Grades were interpolated by inverse distance raised to
the third power, using a number of passes to estimate block grades. Each mineralized zone was
interpolated independently. Since the zones often merged, the composites for the adjoining zones were
also used to interpolate grades of the zone being interpolated. For example, the interpolation of block
grades into zone 7, the footwall zone, used composites from zone 7, and also zone 11, the next higher
zone. The interpolation of zone 11, used the composites from zone 11 as well as the ones from zones 7
and 4, and so on.
The interpolation passes were as follows:
Pass 1. This pass used all of the capped composites for the zone being interpolated as well as the
adjoining capped composites. Since the variograms indicated longer ranges down dip compared
to along strike or across strike this relationship was used to interpolate the block grades. This
pass used an ellipsoid search of 9 m along strike, 15 m down dip, and 4 m across strike to
estimate block grades. A minimum of one composite and a maximum of 8 composites were used
to estimate block grades. A maximum of 2 composites from a single drill hole was applied.
Pass 2. This pass is also known as the “pull1” pass. The composites in the high-grade domain
shown in Table 1.3 were pulled from the composite data set and replaced with the median grade
of the “pull1” domain. This pass estimated grades into only un-estimated blocks in the model.
This pass used an ellipsoid search of 15 m along strike, 27 m down dip, and 8 m across strike to
estimate block grades. A minimum of one composite and a maximum of 12 composites were
used to estimate block grades. A maximum of 3 composites from a single drill hole was applied.
Pass 3. This pass is known as the “pull2” pass. The composites in the “pull1” domain shown in
Table 1.3 were pulled from the composite data set and replaced with the median grade of the
“pull2” domain. This pass estimated grades into only un-estimated blocks in the model. This
estimate block grades. A minimum of 4 composites and a maximum of 12 composites were used
Pass 4. This pass was to add back some of the material lost by cutting. Some very high-grade
material does occur in the deposit. The fourth pass used a 2 x 3 x 3 search with the uncapped
data, to fill only the closest block to the composite. This pass increased the estimated contained
ounces from Pass 3 by about 2.5% at a 1 g Au/t cutoff.
Pass 5. In reviewing the results of the modeling, it was noted that where the drill hole spacing
was 20-25 m, low grade would be estimated between two or more high-grade intercepts. The
reason for this is limitation on the Pass 1 interpolation, and the replacement of high-grade values
with the Pass1 domain median grade. MDA added Pass 5 to increase the search distances in
high-grade areas using the capped composites, rather than replacing with the median value of the
pull1 domain. To define the high-grade areas an indicator was interpolated using the Pass 2
search distances. If the composite value was in the high-grade domain it was given a value of
one, while all other composites were given an indicator of zero. Indicator block grades were
interpolated by inverse distance raised to the third power into all blocks defined in Pass 2. If the

block grade of the indicator was above 0.4, then new values were interpolated in Pass 5 using the
Pass 2 search distances, but with capped composites rather than the pull1 composites.
Since MDA believes that the samples do not represent the material present, i.e. biased toward low grade,
no measured material has been defined. Blocks that are within 6 m of the closest hole or within 12 m
and are estimated with at least three composites are classed as Indicated (1). This material would have
normally been classed as Measured without the sampling issues. Other blocks that were estimated with
passes 1-5 are classed as Indicated (2).
The Indicated material contained within the model is shown in Table 1.4 at various cutoff grades.
Table 1.4 Indicated Material
Indicated 1 Indicated: 2 Total Indicated

Cutoff tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au % of Total tonnes g Au/tonne oz Au
g Au/t 000's 000's 000's 000's 000's 000's
0.00 3,039.5 2.89 282.0 14,048.1 2.03 916.0 100.00% 17,087.6 2.18 1,198.0
0.25 2,646.1 3.29 279.9 11,747.9 2.39 903.4 84.24% 14,394.0 2.56 1,183.3
0.50 2,057.6 4.13 273.0 8,796.1 3.07 869.0 63.52% 10,853.8 3.27 1,142.0
0.75 1,680.2 4.92 265.5 6,954.4 3.72 832.6 50.53% 8,634.6 3.96 1,098.1
0.80 1,626.1 5.05 264.2 6,672.3 3.85 825.6 48.56% 8,298.4 4.08 1,089.7
0.85 1,574.2 5.19 262.8 6,413.7 3.97 818.7 46.75% 7,987.9 4.21 1,081.5
0.90 1,527.1 5.33 261.5 6,178.5 4.09 812.1 45.09% 7,705.6 4.33 1,073.6
0.95 1,480.3 5.46 260.1 5,929.3 4.22 804.7 43.36% 7,409.6 4.47 1,064.8
1.00 1,434.1 5.61 258.6 5,713.3 4.34 798.0 41.83% 7,147.5 4.60 1,056.6
1.05 1,392.1 5.75 257.2 5,489.3 4.48 790.6 40.27% 6,881.4 4.74 1,047.8
1.10 1,353.2 5.88 255.9 5,288.9 4.61 783.7 38.87% 6,642.1 4.87 1,039.5
1.15 1,314.1 6.02 254.5 5,099.6 4.74 776.8 37.53% 6,413.6 5.00 1,031.3
1.20 1,280.6 6.15 253.2 4,917.6 4.87 770.0 36.27% 6,198.2 5.13 1,023.2
1.25 1,247.1 6.28 251.9 4,736.0 5.01 762.8 35.01% 5,983.1 5.27 1,014.7
1.50 1,107.1 6.90 245.7 4,031.4 5.65 731.8 30.07% 5,138.6 5.92 977.5
1.75 989.3 7.53 239.6 3,486.4 6.28 703.5 26.19% 4,475.7 6.55 943.1
2.00 894.6 8.13 233.9 3,080.2 6.86 679.1 23.26% 3,974.8 7.14 913.0
2.25 816.4 8.71 228.6 2,742.2 7.44 656.0 20.83% 3,558.5 7.73 884.5
2.50 749.3 9.28 223.5 2,461.3 8.02 634.6 18.79% 3,210.7 8.31 858.0
2.75 695.6 9.79 218.9 2,220.2 8.61 614.2 17.06% 2,915.8 8.89 833.2
3.00 645.3 10.33 214.3 2,031.9 9.14 596.9 15.67% 2,677.2 9.42 811.2
4.00 502.8 12.28 198.5 1,508.5 11.11 538.9 11.77% 2,011.3 11.40 737.4
5.00 413.0 13.98 185.6 1,194.8 12.86 493.9 9.41% 1,607.8 13.14 679.5
6.00 345.3 15.64 173.6 984.4 14.44 456.9 7.78% 1,329.7 14.75 630.5
7.00 289.7 17.40 162.1 823.6 15.99 423.4 6.52% 1,113.3 16.36 585.4
8.00 246.3 19.14 151.6 705.1 17.42 394.9 5.57% 951.4 17.87 546.5
9.00 215.5 20.67 143.2 612.1 18.78 369.6 4.84% 827.7 19.27 512.8
10.00 188.2 22.29 134.9 530.7 20.21 344.8 4.21% 718.9 20.75 479.6
11.00 163.8 24.05 126.7 466.7 21.54 323.2 3.69% 630.6 22.19 449.9
12.00 145.1 25.67 119.7 411.1 22.90 302.6 3.25% 556.2 23.62 422.4
13.00 129.5 27.25 113.5 368.8 24.09 285.7 2.92% 498.3 24.91 399.2
14.00 114.1 29.11 106.8 330.9 25.31 269.2 2.60% 445.0 26.29 376.0

The Black Fox resource estimate cutoff grade is based on a gold price of $US 600, a 97% recovery, and
an internal cost of $US 16.45/tonne (Owner milling less mining) which is rounded to a cutoff grade of
0.90 g Au/t. This cutoff was applied to material to the 9720 elevation, or about 280 m below the
surface. Below the 9720 elevation, a 3 g Au/t cutoff was used to compute the resource, since it is likely
that this material would only be mined by underground methods. The resources, which exclude
reserves, are shown in Table 1.5.
Table 1.5 Black Fox Deposit Resource Estimate
Indicated (1) Indicated (2) Total Indicated

Elevation Tonnes Grade oz Au Tonnes Grade oz Au Tonnes Grade oz Au
000's g Au/t 000's 000's g Au/t 000's 000's g Au/t 000's
9960 5.1 3.35 0.5 49.8 3.33 5.3 54.9 3.34 5.9
9930 10.5 1.30 0.4 68.3 1.55 3.4 78.7 1.52 3.8
9900 31.4 1.83 1.8 148.2 1.85 8.8 179.6 1.85 10.7
9870 45.9 2.54 3.7 257.5 2.53 20.9 303.3 2.53 24.7
9840 64.0 3.76 7.7 313.2 2.98 30.0 377.1 3.11 37.8
9810 52.0 3.73 6.2 278.0 2.85 25.5 330.0 2.99 31.7
9780 59.8 4.21 8.1 279.8 3.20 28.8 339.7 3.38 36.9
9750 64.3 7.10 14.7 275.3 4.15 36.8 339.6 4.71 51.4
9720 62.0 5.00 9.9 291.0 3.76 35.2 353.0 3.98 45.1
9690 36.4 9.85 11.5 107.9 9.30 32.3 144.3 9.44 43.8
9660 54.1 13.66 23.8 118.3 11.46 43.6 172.4 12.15 67.4
9630 24.4 9.10 7.1 88.4 8.95 25.4 112.7 8.98 32.6
9600 15.7 8.99 4.5 91.2 9.34 27.4 106.9 9.28 31.9
9570 31.7 9.10 9.3 127.6 8.38 34.4 159.3 8.52 43.6
9540 31.1 8.70 8.7 113.6 7.90 28.8 144.7 8.07 37.5
9510 15.6 9.81 4.9 84.8 10.26 28.0 100.4 10.19 32.9
9480 4.6 11.66 1.7 43.5 12.04 16.8 48.1 12.00 18.6
9450 1.8 5.83 0.3 9.9 8.52 2.7 11.7 8.11 3.0
9420 0.0 0.00 0.0 1.9 4.78 0.3 1.9 4.78 0.3
9390 0.1 3.74 0.0 0.6 3.46 0.1 0.7 3.50 0.1
9360 0.0 0.00 0.0 0.0 0.00 0.0 0.0 0.00 0.0
9330 0.0 0.00 0.0 0.0 0.00 0.0 0.0 0.00 0.0
9300 0.0 0.00 0.0 1.0 3.47 0.1 1.0 3.47 0.1
Totals 610.2 6.38 125.2 2,749.7 4.92 434.6 3,360.0 5.18 559.8
These resources do not include the proven and probable reserves.
MDA compared the material predicted by the model inside the mined solids to the actual grade and
tonnage mined. Most of the material was mined by open stoping and records were not kept of the
location of the material shipped to contract mills. A number of discussions were held with Apollo
employees who were also employed by Exall for grade control. Exall recognized that sampling was
difficult and used the occurrence of visible gold to determine if a round should be shipped to the mill
about 50% of the time. In addition, the contract for toll milling called for a minimum of 800 tpd in the
Macassa mill. These factors tend to increase the normal amount of dilution. It is difficult to determine
the cutoff utilized by Exall in completing a comparison of the actual mining to model prediction;
however the actual grade mined matches the model predicted grade using a cutoff grade of about 0.80 g
Au/t.

A total of 1.1 million tonnes grading 6.03 g Au/t (calculated head grade) containing 213,600 ounces of
gold has been mined from the deposit. Over 210,000 ounces of gold were sold by Exall from toll mill
production from the property. Table 1.6 shows the material inside the void solid that is predicted by the
model. This material is not counted in the resource summary. Note that the grade predicted at a 0.75 g
Au/t cutoff grade closely resembles the calculated head grade of the 1.1 million tonnes processed, but
the model predictions are less than 50% of the total ounces actually mined.
The total material in the inferred class is based on the following steps. We started by using the same
relationship of the modeled indicated material to mined material, and assumed that the inferred material
would contain 121.6% of the indicated model ounces at a 0.80 g Au/t cutoff grade. We assumed that the
grade would be the same as the modeled indicated material at a 0.80 g Au/t. From the ounces and grade
we next calculated the tonnes of inferred material at the 0.80 g Au/t cutoff grade. We next needed to
calculate the tonnage above a zero cutoff grade. This was done by assuming that the percentage of the
estimated total tonnage for any cutoff for inferred material would be similar to the percentage estimated
tonnage of the indicated material. From the distribution of tonnage above a given cutoff grade we next
calculated the tonnage above a zero cutoff by using the 48.56% of the total for the 0.80 g Au/t cutoff.
The grade for each cutoff was the same as the model estimate for indicated material. The tonnage above
cutoff was based on the same percentage of total zero cutoff tonnage of the indicated material shown in
Table 1.4. The grade and tonnage above any cutoff was than calculated for inferred materials. Two
classes of inferred materials were also estimated, however the location of the inferred material is
unknown. The first class of inferred material is the un-estimated blocks contained in the mineralized
zones. The tonnage distribution and grade of the indicated blocks was used to estimate the inferred (1)
materials. The second inferred estimate is based on the comparison of the model predicted grade and
tonnage of the 1.1 million tonnes of material that has been mined and processed. Inferred materials are
shown in Table 1.7 for various cutoff grades, while inferred resources are shown in Table 1.8.

Table 1.6 Model prediction of Mined Material
Cutoff 000's Tonnes g Au/tonne 000's oz Au

0.00 751.5 4.10 99.0
0.25 663.6 4.62 98.5
0.50 573.5 5.29 97.5
0.75 504.9 5.92 96.1
1.00 454.1 6.49 94.7
1.25 407.3 7.10 93.0
1.50 364.4 7.78 91.1
1.75 332.4 8.37 89.4
2.00 305.4 8.94 87.8
2.25 282.0 9.51 86.2
2.50 259.3 10.13 84.5
2.75 240.8 10.71 82.9
3.00 227.3 11.18 81.7
3.25 213.2 11.71 80.3
3.50 201.8 12.18 79.0
3.75 192.0 12.62 77.9
4.00 183.1 13.04 76.8
4.25 175.4 13.43 75.8
4.50 167.0 13.89 74.6
4.75 160.5 14.26 73.6
5.00 154.3 14.64 72.7
6.00 132.9 16.12 68.9
7.00 116.2 17.51 65.4
8.00 102.0 18.89 62.0
9.00 89.8 20.31 58.6
10.00 80.9 21.51 55.9
11.00 71.8 22.90 52.9
12.00 64.5 24.20 50.1
13.00 58.1 25.48 47.6
14.00 53.1 26.61 45.4
The model predicts 96,100 ounces should have been mined, while actual records show 213,600 ounces
have been mined, based on toll mill calculated head grades or about 221% of model prediction. While
the records as to the location of the material shipped to the mill are not good, the solids representing the
material mined appear to be complete. The solids indicate a total of about 1.6 million tonnes of material
have been mined, including the drifting by Apollo to establish drill hole stations, of which about 1.1
million tonnes have been sent to toll mills. This past production can be viewed as a very large “bulk
sample” that allows some conclusions. It is not unreasonable to infer that this relationship will continue
between the model based on drill hole information and the actual material in the ground. MDA used the
relationship of the actual mined material and the model prediction to estimate inferred material. The
location of inferred material, however, cannot be estimated due to the sampling issues.

Table 1.7 Black Fox Inferred Material

Based on Underground Production
(121.6% more ounces mined than predicted)*
tonnes g 000's oz
Cutoff (000's) Au/tonne Au
0.00 20,896.5 2.18 1,465.1
0.25 17,602.5 2.56 1,447.0
0.50 13,273.1 3.27 1,396.5
0.75 10,559.3 3.96 1,342.9
0.80 10,148.2 4.08 1,332.7
0.85 9,768.4 4.21 1,322.6
0.90 9,423.2 4.33 1,312.9
0.95 9,061.3 4.47 1,302.1
1.00 8,740.7 4.60 1,292.1
1.05 8,415.3 4.74 1,281.4
1.10 8,122.7 4.87 1,271.3
1.15 7,843.3 5.00 1,261.2
1.20 7,579.8 5.13 1,251.2
1.25 7,316.8 5.27 1,240.9
1.50 6,284.0 5.92 1,195.4
1.75 5,473.4 6.55 1,153.3
2.00 4,860.8 7.14 1,116.5
2.25 4,351.8 7.73 1,081.7
2.50 3,926.3 8.31 1,049.3
2.75 3,565.7 8.89 1,018.9
3.00 3,274.0 9.42 992.0
Table 1.8 Black Fox Inferred Resource

Material Tonnes Grade oz Au
000's g Au/t 000's
Above 9720 elevation 6,626.4 4.00 852.1
Below 9720 elevation 1,228.0 9.71 383.3
Totals 7,854.4 4.89 1,235.4
1.6 Black Fox Project Reserves
The Black Fox project reserves were developed by updating a pre-feasibility study of developing an
open pit mine on the Black Fox property. This study did not consider underground mining as an option,
so the final feasibility study will need to address this option.
Pit optimization studies were completed using the following parameters for the deposit.
Overburden mining cost - $US 1.25 per tonne of material;

Rock mining cost - $US 1.50 per tonne of material;
Processing cost - $US 12.15 per tonne ore;
General and Administrative cost - $US 4.30 per tonne ore;
Plant gold recovery – 96%;

Assume 50% of existing underground workings backfilled with material having a density of
2.0.
Pit Slopes – 48o overall in rock with ramp; 19o overburden
The pit slopes were based on recommendations by Golder Associates for the rock portion of the pit. The
overburden can be as thick as 40 m in the area of the pit. MDA used a 3:1 slope (19o) in the alluvium,
which generally agrees with the slopes recommended by AMEC, however, locally the slopes may need
to be flattened, based on local conditions. In addition, in some areas the overburden slope may be
steepened. A more detailed geotechnical and geo-hydrological program is warranted for the final
feasibility. Table 1.9 summarizes the results of pit optimization studies, which illustrate that the size of
the ultimate pit does not change much over a gold price between $US 350/oz and $US 525/oz. At gold
prices above $US $525 the increase in the size of the pit is very minor to $US 700/oz.
Table 1.9 Black Fox Pit Optimization Results

Gold Price Indicated 1 Indicated 2 Total Indicated Waste Strip Ratio
$/oz Au cutoff tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes t waste/t ore
g Au/t 000's 000's 000's 000's 000's 000's 000's
250 2.12 109.3 10.68 37.5 344.0 8.97 99.2 453.3 9.38 136.7 7,616.4 16.8
275 1.93 131.7 10.32 43.7 430.9 8.18 113.3 562.7 8.68 157.0 9,386.8 16.7
300 1.77 168.3 9.63 52.1 495.9 7.71 123.0 664.1 8.20 175.1 11,639.7 17.5
325 1.63 385.2 7.72 95.6 995.0 6.55 209.5 1,380.2 6.87 305.0 28,391.0 20.6
350 1.51 495.8 7.10 113.1 1,402.3 5.99 269.9 1,898.1 6.28 383.0 38,984.4 20.5
375 1.41 540.4 6.70 116.4 1,588.4 5.58 284.8 2,128.9 5.86 401.2 40,417.0 19.0
400 1.32 568.5 6.45 117.9 1,697.1 5.34 291.1 2,265.7 5.62 409.1 40,910.3 18.1
425 1.25 595.6 6.24 119.5 1,787.1 5.15 295.8 2,382.6 5.42 415.2 41,189.0 17.3
450 1.18 626.3 6.02 121.3 1,916.6 4.92 303.2 2,543.0 5.19 424.4 42,073.1 16.5
475 1.12 649.7 5.85 122.2 2,010.5 4.75 307.0 2,660.2 5.02 429.2 42,128.7 15.8
500 1.06 672.0 5.69 123.0 2,107.2 4.59 311.2 2,779.2 4.86 434.2 42,258.6 15.2
525 1.01 695.3 5.55 124.0 2,201.6 4.46 315.7 2,896.9 4.72 439.8 42,695.5 14.7
550 0.96 725.0 5.41 126.0 2,302.8 4.36 322.7 3,027.8 4.61 448.7 44,224.0 14.6
575 0.92 753.3 5.27 127.5 2,407.4 4.24 328.3 3,160.7 4.49 455.8 45,264.6 14.3
600 0.88 775.2 5.15 128.5 2,502.6 4.13 332.6 3,277.9 4.38 461.1 45,842.6 14.0
625 0.85 797.1 5.05 129.3 2,584.2 4.05 336.1 3,381.2 4.28 465.4 46,341.9 13.7
650 0.82 833.1 4.90 131.2 2,710.8 3.94 343.3 3,543.9 4.16 474.5 48,191.3 13.6
675 0.79 861.4 4.79 132.6 2,804.0 3.86 347.5 3,665.4 4.07 480.1 49,113.6 13.4
700 0.76 889.9 4.69 134.2 2,907.5 3.77 352.1 3,797.4 3.98 486.3 50,073.0 13.2
Following the pit optimization, a final pit and an initial pit were designed using the optimized pit shapes
of the $US 550 and $US 325 optimized pits respectively, as templates for design. The designed pits
were based on Golder’s recommended inter-ramp pit slopes of 54.5o for the south hanging wall slope
and following the 40-50o slope on the north footwall slope. The pits were designed to accommodate 150
tonne trucks with a 20 m wide 10% ramp that narrows to 10 m for benches near the bottom of the pit.
Table 1.10 illustrates the proven and probable reserves of the Black Fox project available by open pit
mining using the designed pits and a $US 550/oz gold price to establish the internal cutoff grade of 0.96
g Au/t. Figure 1.1 illustrates the site layout showing the pit and facilities for the base case.

Table 1.10 Black Fox Proven and Probable Reserves

Total Till Rock
Waste Waste Waste Ore 000's
Pit Phase Tonnes Tonnes Tonnes Tonnes g Au/t oz Au
000's 000's 000's 000's
Phase 1 24,128.4 5,612.8 18,515.6 1,350.8 4.51 195.7
Phase 2 23,102.3 4,093.1 19,009.2 1,711.9 4.60 253.1
Totals 47,230.7 9,705.9 37,524.8 3,062.7 4.56 448.8

1.7 Capital Cost Estimate
Pre-feasibility level capital costs were estimated for the project. All the costs are shown in $US 1st
quarter 2006 costs and based on an exchange rate of $US 1.00 = $ CDN 0.88. Deemed adequate for pre-
feasibility study purposes, the estimates are within an order-of-accuracy of ±25%. Costs for two cases
have been developed:
Case 1 - Owner Mill Case 1. The capital cost of the mill was updated by SRK in 2006.
Toll Mill – In the Toll Mill Case the ore would be contract crushed and shipped to a nearby mill
for processing. This was the case for all historic production.
The basis for the estimate is predicated on:
Preliminary flowsheets and mass balances;

The general arrangement sketches shown in Appendix A;
The mine capital cost estimate is based on utilizing Apollo’s mine equipment from the Montana
Tunnels operation, which was placed on care and maintenance during 2005. A list of this
equipment can be found in Section 22. Some new mine equipment is purchased during years 2
and 3. It should be noted, however, that Apollo announced a joint venture on the Montana
Tunnels operation with Elkhorn Tunnels, LLC on August 1, 2006. At the present time Apollo
believes the effect of the joint venture on the Montana Tunnels equipment availability to the
Black Fox project is unclear for drills, and some smaller items such as fuel and lube trucks. The
trucks, shovel, loader, dozers, and grader should be available for the Black Fox project;
Budget price quotations for approximately 70% of the plant and mine estimated equipment costs;
and
In-house data.
The pre-feasibility capital cost estimates over the life of the mine (not including working capital) for the
owner mill is summarized in Table 1.11.

Table 1.11 Black Fox Capital Cost Estimate

Capital Cost Summary -1 1 2 3 4 5 5 Totals
Item
Access Road $50,000 $50,000
Water Supply $250,000 $250,000
Power Distribution $250,000 $250,000
Communications $50,000 $50,000
Process Plant $21,811,204 $50,000 $50,000 $50,000 $50,000 $22,011,204
Tailings $5,483,104 $0 $3,012,779 $3,012,779 $500,000 $12,008,662
Mine Equipment $2,768,250 $238,500 $4,775,000 $5,150,100 $175,000 $13,106,850
Haul Road Construction $100,000 $100,000 $200,000
Administration Building $250,000 $250,000
Slop Building $1,000,000 $1,000,000
Site Fencing $75,000 $75,000
Closure $2,601,700 $2,601,700
Owners Cost $2,029,432 $2,029,432
EPCM and Indirects $5,446,577 $5,446,577
Contingency $5,934,535 $33,850 $783,778 $821,288 $72,500 $5,000 $260,170 $7,911,121
Preproduction Stripping $9,192,459 $9,192,459
Totals $54,690,561 $372,350 $8,621,557 $9,034,167 $797,500 $55,000 $2,861,870 $76,433,005
1.8 Operating Cost Estimate
A production schedule was produced for processing the open pit material at a rate of 540,000 tonnes of
ore per day. A one year period of pre-production stripping is required to expose the ore below the
covering of glacial till. The production schedule is shown in Table 1.12.
Table 1.12 Black Fox Open Pit Production Schedule

Item Year -1 1 2 3 4 5 6 Totals
Waste Units
Overburden Waste 000's 5,353 259 3,892 201 0 0 0.0 9,705.9
Bedrock Waste 000's 2,581 8,616 5,853 7,374 7,679 3,455 1,967 37,524.8
Total Waste 000's 7,935 8,875 9,745 7,574 7,679 3,455 1,967 47,230.7
Ore
Tons Ore 000's 540.0 540.0 540.0 540.0 540.0 362.7 3,062.7
Gold Grade g Au/t 4.714 4.601 4.713 4.016 5.173 3.923 4.558
Gold Ounces 000's 81.8 79.9 81.8 69.7 89.8 45.8 448.8
The operating cost estimate of the project is in 1st quarter 2006 US dollars ($US) and is based on
detailed evaluation of four principal cost centers:
Labor;
Operating supplies;
Repair supplies; and
Power
The labor requirements of the owner milling case are shown in Table 1.13. In the toll milling case the
manpower requirements would be reduced by 35 people each year.

Table 1.13 Black Fox Project Manpower Requirements (Base Case)

Area Year -1 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Staff
Mine Operations 7 8 8 8 4 4 4
Mine Maintenance 3 5 5 5 4 4 4
Mine Engineering 4 4 4 4 3 3 3
Geology and Ore Control 4 4 4 4 4 4 4
Processing 12 12 12 12 12 12
Administrative 7 7 7 7 7 7 7
Total Staff 25 40 40 40 34 34 34
Hourly
Mine Operations 35 50 52 52 41 33 21
Geology and Ore Control
Processing 23 23 23 23 23 23
Total Hourly 64 113 115 115 98 87 72
Total 89 153 155 155 132 121 106
Pre-feasibility estimated operating costs over the life of the mine for the different cases are summarized
in Table 1.14. The operating cost estimate for the owner mill operating cost was updated by SRK in
2006.
Table 1.14 Black Fox Operating Cost Estimate

Item Owner Mill Toll Mill
Mining $62,858.9 $51,466.8
Processing
Loader at Crusher $706.7 $410.1
Ore $37,243.0 $57,897.6
Administration $10,541.9 $6,333.0
Totals $111,350.6 $116,107.4
$/t ore $36.36 $65.33

$/ oz Au $255.76 $304.94
Net Before Taxes 106,331.4 74,270.7
Note: Toll Milling Cost May Vary. This estimate is
based on an estimated cost of $27.72/t + transport
and crushing
1.9 Project Economics
A pretax economic evaluation was completed for the two options. The evaluations to date indicate
better returns from the toll milling case, however MDA suggests that an owner operated mill should be
given serious consideration due to several factors:

The present estimate of reserves from the property is likely to underestimate the tonnage of ore-
grade material, based on the estimate of historic production from the current model.
The potential for developing underground minable reserves is considered good.
Improved control of the operation, operating cost, and gold recovery.
The operating cost of toll milling is projected to be about $50 per ounce of gold higher than
owner milling.
MDA believes that the two sampling issues noted at the property will result in drill holes samples that
under represent the amount of contained gold on the property. The use of the drill hole samples to
estimate the deposit resource and reserves will also likely underestimate the amount of gold in the
contained in the deposit resources and reserves. This should be taken into consideration when the
economics of the project is reviewed. More than twice the ounces predicted by the MDA model were
mined by Exall. This is a major factor in evaluating the project.
Table 1.15 shows a summary of the Black Fox pre-tax economics of the two cases.
Table 1.15 Pre-tax Economic Evaluation Summary
Production Rate Cutoff Grade Gold Price Case Pretax Cashflow 3% NPV 5% NPV IRR Op Cost Op Cost
tonnes/year g Au/t US $/oz US $ Millions US $ Millions US $ Millions % US $/oz US $/t ore
540,000 0.96 500 Owner Mill 33.9 23.3 17.3 13.2% 255.8 36.4
540,000 0.96 550 Owner Mill 55.7 42.4 35.0 21.3% 255.8 36.4
540,000 0.96 600 Owner Mill 77.4 61.6 52.7 29.3% 255.8 36.4
540,000 1.90 500 Toll Mill 45.5 39.5 35.9 66.0% 304.9 65.3
540,000 1.90 550 Toll Mill 64.5 56.8 52.3 94.6% 304.9 65.3
540,000 1.90 600 Toll Mill 83.5 74.2 68.6 123.6% 304.9 65.3
Figure 1.2 illustrates the pre-tax cashflow sensitivity to operating cost, capital cost, recovery and gold
price for Owner Mill and the Toll Milling options. Figure 1.3 shows the sensitivity of the pre-tax
Internal Rate of Return to operating cost, capital cost, recovery and gold price for Owner Mill and Toll
Milling options.

Figure 1.2 Sensitivity of Pre-tax Cash Flow
100.0
90.0
80.0
70.0
NPV (5%) Millions
60.0
50.0
40.0
30.0
20.0
10.0
0.0
0.8 0.85 0.9 0.95 1 1.05 1.1 1.15 1.2
% of Base Case
Toll Mill - Gold Price Owner Mill - Gold Price Toll Mill - Op Cost
Owner Mill - Op Cost Toll Mill - Cap Cost Owner Mill - Cap Cost
Figure 1.3 Sensitivity of Pre-tax Internal Rate of Return
180%
160%
140%
120%
100%
IRR
80%
60%
40%
20%
0%
0.8 0.85 0.9 0.95 1 1.05 1.1 1.15 1.2
% of Base Case

1.10 Recommendations
The main recommendation for future work is to confirm that the model underestimates the actual
material in the ground. The two sampling issues are both related to sample size. A “one million tonne
bulk sample” by Exall has already confirmed that the present grade model does not estimate the amount
of gold within the mined area. Additional bulk samples combined with mini-bulk sample gravity testing
and metallic check assaying are needed to confirm this will continue to happen.
The pit bottoms of the current designed pit are based on high-grade material intersected by underground
drilling. This material should also be tested on closer spaced drilling. It may be possible to reduce the
overall strip ratio of the open pit by mining some of the material near the pit bottom by underground
methods. The interface between the pit bottom and the potential start of the underground mine needs
more detailed drilling in order to plan the location and design parameters for the crown pillar.
The following feasibility program should be completed for the project:
Resources and Reserves:

Check sample selected intervals by metallic assaying. At least 5-10% of the material inside the
mineralized zones should be checked by metallic assay. The average grade of the metallic check
samples should match the average grade of the mineralized zones at a zero cutoff. This will help
to get a handle on one of the two sampling issues.
Complete about 150 mini-bulk sample gravity checks on drill hole composite samples. The
average grade of the samples tested should be equivalent to the average grade of the mineralized
zone at a zero cutoff. Again, this will help get a handle on how much gold was missed by the
small samples originally assayed.
Design and complete a bulk sampling program for the green carbonate and “flow ore”
mineralization types. The bulk sampling program should be designed to determine differences
between grade model and actual mineralization. The biggest problem will likely be to define
what is and is not mineralized material. We believe that a small gravity plant should be set up to
determine if a round mined is mineralized or not. This sampling plant will properly reduce each
round to a sample that can be processed by gravity. We do not believe that channel and muck
sampling will be successful in determining the actual grade of mineralized rounds, however,
there is a better probability if large samples are taken and the face samples on both sides of the
round are used to determine if a round is mineralized. We believe that if the mill processing the
sample does not have a gravity circuit, as is the case with Macassa, the test may not be
appropriate without a small gravity plant on site to obtain a good head grade sample. The bulk
sample should check an area that contains the typical grade distribution of the deposit and not
concentrate on high-grade areas.
Extend the 235 level to the east and continue to develop the “flow ore” mineralization

Geological and Geotechnical
Oriented core drilling for rock mechanics of typical ore and waste areas. Golder is suggesting 6-
8 holes of NQ size with geotechnical logging;
Additional geotechnical testing of the overburden in select areas
Ore and waste rock strength testing;
Geotechnical and Geological mapping of the underground workings;
Mapping of the underground workings to show areas that are open (rather than containing fill).
Complete surveying of all accessible workings
Penetration Rate Testing – Obtain 1 ft x 1 ft samples of representative ore and waste, say 10
samples of each. Get the samples to drill vendors for testing;
Geologic mapping of the underground to compare to existing maps;
Determination of dewatering requirements;
Condemnation drilling in tailings and mine rock waste area;
Waste rock characterization.
Overburden characterization.
Metallurgical Testing
Bottle roll characterization, with thin section mineralogy;
Semi-autogenous grinding amenability tests (Lakefield quote - CDN $72,500);
Testwork required to confirm reagent consumption assumptions used in the pre-feasibility study,
based on the Lakefield 1999 test program (Lakefield quote - CDN $46,040);
Utility Supply
Power supply review
Water supply review

2.0 INTRODUCTION AND TERMS OF REFERENCE
Mine Development Associates (MDA) has prepared this technical report for the Black Fox project at the
request of Apollo Gold Corp. Apollo purchased the Black Fox gold deposit formerly known as the
Glimmer Mine, located near Matheson, Ontario, Canada from the Glimmer Mine Joint Venture of Exall
Resources Ltd., and Glimmer Resources on September 7, 2002. This technical report describes MDA’s
update of the MDA 2004 pre-feasibility study of the Black Fox project.
The purpose of this report is to provide technical support for Apollo’s resource and reserve calculations
for the Black Fox project and to satisfy Apollo’s obligation to file a technical report to be made available
to the public. The technical report was written in compliance with disclosure and reporting requirements
set forth in the National Instrument 43-101.
The scope of this study included a review of pertinent technical reports and data in possession of Apollo
relative to the general setting, geology, project history, exploration activities and results, methodology,
quality assurance, interpretations, resources and reserves. Each element of the scope was addressed in
the context of the company’s target concepts, recent results, and proposed activities.
The author’s mandate was to comment on substantive public or private documents and technical
information listed in the Reference Section (23). The mandate also required on-site inspections and
preparation of an independent technical report containing the author’s observations, conclusions and
recommendations. A total of 100 man-days were required to complete the mandate, including a site
inspection that was conducted on August 19 and 20, 2003 by Neil Prenn, and on October 4 and 5, 2005
by Michael Gustin.
Disclaimer:
MDA has prepared Sections 1 thru 15 and 17 thru 23. Peter Taggart prepared section 16 for the 2004
pre-feasibility study 43-101 report, which has not changed in the current version. SRK updated the
processing capital and operating cost estimates found in Section 22. Neither Taggart nor SRK nor MDA
accepts any responsibility or liability for the sections of the report that were prepared by the other party.
This Report is directed solely for the development and presentation of data with recommendations to
allow for Apollo Gold to reach informed decisions. Except for the purposes legislated under provincial
securities law, (a) any use of this report by any third party is at that party's sole risk, and MDA, nor any
of their respective directors, officers or employees shall have any liability to any third party for any such
use for any reason whatsoever, including negligence, and (b) MDA disclaim responsibility for any
indirect or consequential loss arising from any use of this report or the information contained herein.
This report is intended to be read as a whole, and sections should not be read or relied upon out of
context. This Report contains the expression of the professional opinions of MDA, based upon
information available at the time of preparation. The quality of the information, conclusions and
estimates contained herein is consistent with the intended level of accuracy as set out in this report, as

well as the circumstances and constraints under which the report was prepared which are also set out
herein.
As permitted by Item 5 of Form 43-101F1, MDA has, in the preparation of this Report, relied upon
certain reports, opinions and statements of lawyers and other experts. These reports, opinions and
statements, the makers of each such report, opinion or statement and the extent of reliance is described
in Section 3 of this Report. MDA hereby disclaim liability for such reports, opinions and statements to
the extent that they have been relied upon in the preparation of this Report, as described in Section 3.
As permitted by Item 16 of Form 43-101F1, MDA has, in the preparation of this Report, relied upon
certain data provided to MDA by Apollo Gold and certain other parties. The relevant data and the extent
of reliance upon such data is described in this Report.
Currency, units of measure, and conversion factors used in this report include:
Linear Measure
1 inch = 2.54 centimeters
1 foot = 0.3048 meter
1 yard = 0.9144 meter
1 mile = 1.6 kilometers
Area Measure
1 acre = 0.4047 hectare
1 square mile = 640 acres = 259 hectares
Capacity Measure (liquid)

1 US gallon = 4 quarts = 3.785 liter
1 cubic meter per hour = 4.403 US gpm
Weight
1 short ton = 2000 pounds = 0.907 tonne
1 pound = 16 oz = 0.454 kg = 14.5833 troy ounces
1 oz (troy) = 31.103486 g
Analytical Values percent grams per troy ounces per
metric tonne short ton
1% 1% 10,000 291.667
1 gm/tonne 0.0001% 1 0.0291667
1 oz troy/short ton 0.003429% 34.2857 1
100 ppm 2.917

Currency Unless otherwise indicated, all references to dollars ($) in this report refer to currency of the
United States.
$1 US = CDN $1.14
$1 CDN= $0.88 US
Frequently used acronyms and abbreviations

AA atomic absorption spectrometry
Ag silver
Apollo Apollo Gold Corporation
Au gold
Black Fox Glimmer Gold Mine
°C degrees Centigrade
CIC Carbon-in-column
CIM Canadian Institute of Mining, Metallurgical, and Petroleum
CIP Carbon-in-pulp
DPFZ Destor-Porcupine Fault Zone
Exall Exall Resources Ltd.
°F degrees Fahrenheit
ft foot or feet
g gram(s)
g/kWh grams per kilowatt hour
g/t grams per tonne
Glimmer Glimmer Resources
h hour
km kilometer
kV kilovolts
kWh Kilowatt hour
kWh/t Kilowatt hours per tonne
L liter
m meter(s)
m2 square meter(s)
m2/t/d square meters per tonne per day
m3 cubic meter(s)
m3/h cubic meter(s) per hour
mm millimeter
MW megawatts
Noranda Noranda Exploration Company, Ltd.
NSR net smelter return

oz Ag/t troy ounces silver per short ton (oz/ton)
oz Au/t troy ounces gold per short ton (oz/ton)
RC reverse circulation drilling method
RMSB Ross Mine Syenitic Belt
RPA Roscoe Postle Associates Inc.
SAG semi-autogenous grinding
SRK SRK Consulting Group
t tonne(s)
t/m3 tonne per cubic meter
tpd tonnes per day
tph tonnes per hour
tonne long ton
μm micron(s)

3.0 RELIANCE ON OTHERS
In preparing this Report MDA has relied upon certain reports, opinions and statements of lawyers and
other experts. This report, opinions and statements, the makers of each such report, opinion or statement
and the extent of reliance is described below. MDA hereby disclaim liability for such reports, opinions
and statements to the extent that they have been relied upon in the preparation of this Report, as
described below.
3.1 Land
Certain land agreements and other documents were provided by Apollo describing the land position of
Apollo, and are included in Section 4 of this report. For matters related to title to the property and
related property rights, MDA have relied on the opinions of Apollo Gold Corporation. Although MDA
is not a “Qualified Person” for assessing the validity of the land position, Apollo has completed a due
diligence review. Apollo has provided copies of legal documentation regarding the purchase/option
agreement with Exall Resources Ltd and Glimmer Resources covering the Black Fox project, and the
acquisition of surface and mineral rights from Timmins Forest Products.
3.2 Permitting
The permitting requirements write-up contained in Section 4 of this report was provided by Apollo Gold
Corporation.
3.3 Geotechnical Report
Several geotechnical reports have been prepared for the project. During 2004, Golder Associates
prepared “Preliminary Assessment of Open Pit Slope Parameters for the Apollo Gold – Black Fox
Project” and “Prefeasibility Study – Proposed Tailings Area – Black Fox Project”. Later, in December
2004, AMEC prepared “ Open Pit Overburden, Waste Stockpiles, and Tailings Impoundment – Pre-
feasibility Design Study” In addition, and in conjunction with their Pre-feasibility Design Study, AMEC
prepared a “Tailings Facility Capital Cost Estimate”.
3.4 Processing
The processing plant was designed by Peter Taggart during the 2004 Pre-feasibility study of the Black
Fox Project. The Taggart process plant design is used for this study as well, with the processing capital
and operating cost estimates updated by SRK.

4.0 PROPERTY DESCRIPTION AND LOCATION
4.1 Location
The Black Fox exploration project is located 10 km east of Matheson, Ontario, on Hwy 101 East.
Matheson is approximately 650 km north of Toronto, Ontario. The Black Fox property is centered at 48°
30'N latitude and 80° 21'West longitude UTM. Exall Resources formerly operated the Glimmer
underground mine on the property. Figure 4.1 and 4.2 illustrate the location of the property
4.2 Land Area
The property occupies an area of 1983.63 acres (about 803 ha), and is located in the Hislop and Beatty
townships, District of Cochrane, in the Larder Lake Mining District. The land consists of 163.2 acres of
claims (about 66 ha), 1078.2 acres of owned land (about 436 ha), 431.2 acres of surface rights only land
(about 174.5 ha), 39.2 acres (about 16 ha) of surface and mineral rights land, and about 311 acres of
mineral only lands (about 126 ha). Table 4.1 provides a list of the current land position. Figure 4.3
shows the location of the property.
Table 4.1 Current Black Fox Project Property Summary

Township Concession # Lot # Parcel Acreage Hectares Status
Hislop 6 4 3,393 160.2 64.8 Owned
Hislop 6 5 11,511 80.5 32.6 Owned
Hislop 6 6 6,413 80.5 32.6 Owned
Hislop 6 6 2,582 155.4 62.9 Owned
Hislop 6 7 388 142.8 57.8 Owned
Hislop 6 7 15,466 97.0 39.2 Owned
Hislop 6 7 4,707 46.0 18.6 Owned
Hislop 6 8 7,745 164.2 66.5 Owned
Beatty 1 6 14,572 151.7 61.4 Owned
Subtotal Owned 1,078.2 436.4 Owned
Beatty 1 5 15,639 39.2 15.9 Surface Rights Only
Subtotal Surface 431.2 174.5 Surface Rights Only
Beatty 1 5 15,661 Surface and Mineral
Beatty 1 7 3524 155.5 62.9 Mineral Only
Beatty 1 7 11720 155.5 62.9 Mineral Only
Subtotal Mineral 311 125.9 Mineral Only
Beatty 1 6 L-1115059 40.8 16.5 Unpatented Claim
Hislop 6 5 L-1048333 40.8 16.5 Unpatented Claim
Subtotal Claim 163.2 66.0 Claim
Total Land 1,983.6 802.8 All Types

4.3 Mining Claim Description
Apollo reports all mining claims associated with the Black Fox property are up to date, and in good
standing order. All claims associated with the property are unpatented. All the claims are located
within the Larder Lake Mining District 90. Apollo reports the claims are current and the required CDN
$400.00 of work done per claim as of September 1, 2006 has been completed. The mining claims have
been surveyed.
4.4 Agreements and Encumbrances
Apollo Gold Corporation concluded an option to purchase 100% of the Glimmer Mine (Black Fox
Mine) for which change of property title was transferred on September 7, 2002. The Black Fox property
was purchased from Exall Resources Ltd. and Glimmer Resources, which had comprised the Glimmer
Mine Joint Venture. The purchase involved payment of CND $3,159,000 and 2.08 million shares of
Apollo Gold Corporation to the joint venture. An additional cash payment of CND $3 million was made
in January, 2006. None of the currently defined resources or reserves are subject to any production
royalties. Apollo Gold Corporation controls 100% ownership of the property and all mineral, surface,
and forestry rights. The property is currently on a care and maintenance basis. Exploration activities are
being conducted to address further potential for the property.
The property purchase included the following items:

• Surface mechanical shop (40’x 60’x 20’);
• Trailer complex complete with administration office, dry, geological/engineering office,
and shower/washroom facility;
• Fresh Water Tank, 3,000 gallon capacity, with tin insulated shed.
• Explosive magazine (empty - 10’x10’x7’);
• Blasting cap magazine (empty - 4’x4’x7’);
• Warehouse trailer;
• Mechanical trailer;
• Electrical trailer;
• Geological trailer;
• Compressor station building (25’x30’x15’);
• Environmental Building (10’x20’x8’);
• Froome Lake pumphouse (5’x8’x7’);
• Mine house (storage), 1000 ft2, and two levels, with ¾ basements; and
1000 gallon diesel tank.
• Polishing Pond
• Settling Pond
• Spillway Pond
• Waste Ore Pad
Additional adjacent land was purchased by Apollo late in 2003. The Ewen property, consisting of
sections 11511 and 3393 in the Township of Hislop, was purchased in November 2003 for

CDN$180,000. No resources or reserves are currently contained on the Ewen property, but if found
would be subject to a 3% NSR. A CDN$500 annual minimum royalty applies to the property. The
seller has first right of refusal to the property after mining and reclamation has been completed.
Appollo reached an agreement with Timmins Forest Products for the purchase of surface and mineral
rights of adjacent land for CDN$100,000. Only one of the 12 parcels carries mineral rights, and all
carry surface rights. The parcel with mineral rights is subject to a 2% NSR royalty, with a royalty
buyout provision of CDN$500,000. No resources or reserves are currently contained on the parcel.

Figure 4.1 Black Fox Location Map

August 14, 2006
1 3
Lake
1
Mine Development Associates

1
1
Apollo Gold Corporation
Frederick
House 1 Abitibi
Lake 1
e
2 Fault Zon
1 Pipestone
2 BLACK FOX PROJECT
2 1
2 10 2 1
3 4 5
14 13
0 10 20 1 2 2 rcupine
1 Destor Po
6 8 15 3 1
Km. 7 9 1
1 1 1 16 3 3 3 12
1 Nighthawk
TIMMINS Lake 11
2 Fault Zone
1
1 3 1
2 1
1
3 1
1 3
3 3
1 3
1 1
Figure 4.2 Adjacent Mines Location Map
LEGEND 1 Hollinger & McIntyre 9 Aquarius

2 Dome 10 St Andrew Goldfields
3 Granitic Rock
3 Bell Creek 11 Ross
2 Metasediments 4 Owl Creek 12 Holt McDermott
5 Hoyle Pond 13 Conamax East Zone
1 Metavolcanics
6 Holinor 14 Holloway Mine
Fault 7 Pamour I 15 Goldpost
8 Nighthawk Peninsular 16 Stroud - Cheveron
Gold Deposits
Neil Prenn 8/14/06 1:47 PM

\\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc
Page 35
Figure 4.3 Black Fox Claim Map

4.5 Environmental Liabilities
There are currently no environmental liabilities at the Black Fox Mine Site. A bond of $675,000.00 has
been supplied to the Ministry of Northern Development and Mines for future site remediation at the
Black Fox Mine site. Further bonding will be required as mining operations develop at the Black Fox
site. Ore from the former operation was processed off-site.
4.5.1 Permitting
Permitting requirements will be dependant on mining plans. Mining plans will be dependant on the
results of the current exploration activities that are being conducted. A list of permits has been
established that covers all aspects for an open pit mine in the Larder Lake Mining District. Permits
listed are only for open pit production and do not include milling on-site.
Ontario’s environmental assessment (EA) process consists of a review and approval process in which
the likely environmental effects of certain undertakings and the effects of alternatives to the undertaking
are predicted and a decision is made as to whether or not the undertaking should proceed and, if so, how
it should proceed.
Recently, many of Ontario’s Ministries have set up and initiated their own internal EA processes to
ensure that each Ministry is complying with all aspects of their responsibility for environmental
screening and consultation under both federal and provincial legislation. Typically, mine development
projects are now being caught up within these internal environmental assessment processes. The data
contained in this section was obtained from Apollo (Ryan Lougheed) or a February 2004 review by
AMEC Americas.
Environmental permit requirements associated with the development of an open pit mine have been
evaluated. A summary of the environmental requirements along with a brief explanation of the rationale
follows:
Federal EA Process The EA process at the federal level is governed by the Canadian
Environmental Assessment Act (CEAA). Any project which encompasses a federal “trigger” is
subject to a CEAA screening, comprehensive study, or full panel review, depending on the
severity of the anticipated impact and the perceived level of public concern over the project.
o Appropriate ecological surveys need to be done at and around the site to determine
whether the Fisheries Act HADD will apply. Should the CEAA be so triggered, then it is
possible that a screening level assessment could suffice, or that a comprehensive study
would be required. Another potential trigger, at the Black Fox Project, would be the
intention to manufacture explosives on-site, which would require a license under the
Explosives Act, and thus trigger CEAA. As well, certain type licenses for magazines
would also trigger CEAA.
o Once the federal government decides that CEAA does apply to a project, then the federal
government will appoint a “Responsible Authority” to oversee the environmental
screening and/or assessment process under CEAA.

Department of Fisheries and Oceans – Fisheries Act -Authorization to alter or harm fish habitat;
Department of Natural Resources Canada – Explosives Act – License to manufacture
explosives on-site; License for a magazine for explosives (certain types).
Ministry of Transportation (MTO) MTO will likely require a Class EA for the conceptualized
highway crossing of Highway 101 for the development of the proposed overburden dump
located north of the mine site. The complexity of the assessment and related technical studies
and engineering designs can vary widely, depending on the type of permit required for the
crossing. It is expected that the approval process for a crossing of this type could represent a
fairly lengthy timeline.
Ministry of Northern Development and Mines (MNDM) The MNDM is the lead agency in
any mine development and/or exploration. They will be the main contact and be responsible for
most of the environmental aspects of this project. Other agencies have responsibilities in the
process, but they feed into the MNDM process.
o The first requirement is to update the existing Closure Plan to reflect the current and
expected plan and financial assurance. The new plan will reflect the new requirements of
the Closure Plan regulations. Along with this updated plan, financial assurance for the
project must be updated and provided. There must be an official “Notice to the Director”
provided to the MNDM. This is a simple form which will be included with the updated
Closure Plan.
o There will be a need for a Public Meeting or information session. This session should
detail the plans for the property, operation, and restoration. The majority of the attendees
will be interested local people who may be impacted by the operation such as trappers,
loggers, snowmobile/4 wheeler clubs, and people looking for work.
Ministry of the Environment (MOE) The provincial Environmental Assessment Act requires
EIAs for projects of the provincial government, and to those designated by specific regulation.
Only one mining project has been so designated in the past two decades. The Electricity Projects
Regulation requires environmental assessment at various levels for projects or parts of projects to
generate and/or transmit electricity. Transmission lines and transformer stations require
assessment to some degree, depending on ultimate capacity, and in the case of transmission lines,
on length. An assessment of this type may be required in the event that additional power
upgrades are required for an on-site milling facility.
o Environmental Protection Act

Certificates of Approval (Air) for all site air emissions (maintenance shops, diesel
generators, ventilation exhaust fans, crushing areas, fugitives from vehicle traffic,
etc.);
Certificates of Approval (Waste Disposal Site) covering site landfill and disposal
of waste (if an on-site landfill is anticipated);

Hazardous waste generator registration for the on-site storage and off-site disposal
of any hazardous waste;
o Safe Drinking Water Act (SDWA)

Registration and approval for Non-municipal Drinking Water System as per Reg.
170/03 for operation of potable water system.
o Ontario Water Resources Act (OWRA)
Certificates of Approval (Industrial Sewage Works) for the treatment and
discharge of minewater; construction and operation of settling ponds; dewatering
wells, sewage treatment plant, open pit, etc.;
Permits to Take Water to withdraw water from any surface and/or groundwater
source, including the dewatering of the open pit and underground facilities, if the
total volume of taking exceeds 50,000 litres per day;
Certificates of Approval for Private Water Works for the treatment, storage and
distribution of potable water;
Certificates of Approval Private Sewage Works for the treatment and disposal of
domestic sewage;
Note: The approval of a potable water system will fall under either the OWRA or the
SDWA dependant on a number of different criteria.
Ministry of Natural Resources (MNR) A recent development within the regulatory framework
in Ontario is the MNR’s requirement for an EA for the disposition of crown lands. MNR now
has the authority to require an EA for certain instruments that did not require them in the past,
for example, for something as simple as a work permit for a culvert crossing. This EA process is
currently being applied for a similar mine project in the Timmins area. The MNR process
would not be required for the Black Fox Project as long as Crown Lands are not impacted by the
development.
o As this project is within the limits of the Township of Matheson and on patented land, the
MNR requires only a short ‘project notification’. This is a relatively simple short process.
If the project was to involve the modification or crossing of a waterway, the MNR would
have more input into the process. If there is a ‘disruption or alteration to fish habitat’ the
federal Environmental Assessment process would be triggered.
o Lakes & Rivers Improvement Act
Work Permits for stream diversions and/or access road creek crossings (maybe);
Authorization for in-stream works (maybe).
o Public Lands Act (Maybe)
Work Permits for all works on any public lands associated with the project such
as roads, clearing of trees, stripping, stockpiles, drainage facilities, etc;

Land tenure must also be obtained which can take the form of easements, land use
permits, license of occupation, a lease or outright purchase or sale;
o Aggregates Act
Permit to take aggregates from an on-site quarry (maybe).
Township of Matheson Once there is certainty of the type/design of the project, notification to
the Township of Matheson should be given. Septic requirements will have to be reviewed and/or
amended if applicable.
Ministry of Labour (MOL) The MOL will require a short Notice of Project form to be filled
out and submitted as ‘registration’ of work.

5.0 ACCESS; CLIMATE; LOCAL RESOURCES; INFRASTRUCTURE; AND

PHYSIOGRAPHY
5.1 Access
The Black Fox property is located 10 km east of Matheson, Ontario, on Hwy 101 East. All
services/material can be transported via Hwy 11 to Hwy 101 East.
Drill sites are located on or to the south of the former Glimmer property. Access to drill rigs is from
former mine site roads or bulldozer trails built for drill rig location from the mine site roads.
5.2 Climate
The Black Fox property temperature ranges from 20 to 33°C during the summer months and -30 to 10°C
during the cooler winter months. The winter season ranges from October to May. Rainfall varies from
about 4.0-10.0 mm of rain/year. Heavy snowfall can produce local flooding on the property for short
periods of time during the spring months. Past operations have not been affected by weather at the
Black Fox property. The property is mainly agricultural land with secondary growth of poplar and
willow shrub.
5.3 Local Resources and Infrastructure
Supplies and services are available in Matheson or Timmins, Ontario and can be delivered on a 12 hour
turnaround. Forestry and mining are the main industries in the area. The Black Fox property is located
in a well established mining camp area; mining and exploration personnel are readily available for
projects in the area. Mining equipment and drilling equipment can be easily shipped to the Black Fox
property via Hwy 101 East.
Access and surface rights are owned outright by Apollo Gold. There are several small lakes that supply
abundant natural water to the Black Fox property for both mining and exploration activities. Hydro
power is supplied via regular service from Hwy 101 East.
5.4 Physiography
The Black Fox property area is predominantly agricultural land with mature poplar, black spruce, and
white birch forest located to the south and eastern borders of the property. The entire property drains
into the Black, Abitibi, and Moose Rivers. The Black Fox property has moderate topography with
elevation ranging from 295 to 298 m.

6.0 HISTORY
6.1 Exploration History
Drilling appears to have been initially carried out on this property in 1952 by Dominion Gulf. Later in
1962 Hollinger completed drilling on the property. Their holes were drilled near diabase dikes located
in the easternmost part of the property. In 1988, Glimmer Mine Inc. put together the property package
using a combination of crown and private lands.
In 1989 Noranda Exploration Company Ltd. entered into a joint venture agreement with Glimmer to
hold a 60% interest in the property. Between 1989 and 1994, Noranda, and later Hemlo Gold Mines
Inc., completed eight drill programs. A total of 142 holes were completed totaling 27,800 m of drilling.
By 1994 the drilling programs had defined an intensive grouping of ore zones in two areas of the
property within 250 m of the surface. Some spectacular gold intersections, including abundant visible
gold, were obtained during the drilling program. However, in addition to diamond drilling, exploration
was conducted by way of geological, magnetic and gradiometer surveys, a UTEM survey, and a limited
I.P. survey.
Exall Resources Limited purchased the property from Hemlo Gold Inc. in April 1996, obtaining
approximately 60% interest in the property with Glimmer Resources Inc. holding the remaining portion.
The Black Fox deposit is East of the City of Timmins in Northeastern Ontario on the Destor-Porcupine
Fault Zone (DPFZ). The DPFZ has a strike length of about 200 km, along which many of Ontario’s
gold mines are located.
6.2 Production History
Ore mined from the Black Fox Mine property was custom milled from 1997 through September 1999 at
the Saint Andrews Goldfields mill (34 km from the mine), and from October 1999 through May 2001 at
Kinross Gold’s Macassa facility in Kirkland Lake, subsequent to mineral tests carried out by Lakefield
Research and other metallurgical laboratories. These mills used cyanidation of the whole ore to process
the ore. Testwork has indicated that gravity pre-concentration may improve gold recovery.
Table 6.1 summarizes the reported gold production of 210,800 ounces from the Black Fox property,
with the grades required @ 100% recovery. Figure 6.1 illustrates several views of the underground
workings of the mine at end of year 2000.
Table 6.1 Black Fox Project – Production History

Year Tonnes Grade Ounces Au
000's g Au/t 000's
1997 194.5 6.79 39.9
1998 308.7 6.67 64.3
1999 258.7 5.82 48.3
2000 255.2 5.82 46.4
2001 81.7 4.81 11.9
Totals 1,098.8 5.97 210.8

6.3 Historic Resource Estimates
The historic resource estimates are summarized in Table 6.2. All of the resource estimates include
reserves, except the 1998 estimate which is in addition to reserves.
Table 6.2 Historic Resource Estimates

Year Measured Indicated Total Measured and Indicated Inferred Estimator
Tonnes Grade Oz Au Tonnes Grade Oz Au Tonnes Grade Oz Au Tonnes Grade Oz Au
000's g Au/t 000's 000's g Au/t 000's 000's g Au/t 000's 000's g Au/t 000's
1994 727.0 11.30 264.0 Hemlo (Jarvi)
1996 551.0 11.52 204.1 Roscoe Postle
1996 677.7 11.30 245.7 Roscoe Postle
1998 43.6 4.84 6.8 153.8 5.58 27.6 197.5 5.42 34.4 382.2 10.33 127.0 Exall
1999 409.5 7.27 95.7 795.5 8.20 209.8 1,205.1 7.88 305.5 273.5 5.96 52.4 Exall
2000 585.5 6.93 130.5 1,022.3 7.36 241.8 1,607.8 7.20 372.3 380.5 6.65 81.3 Exall
2001 267.9 4.09 35.2 565.5 4.93 89.7 833.4 4.66 124.9 352.9 7.00 79.4 Exall
Note: All resources include material reported as reserves except 1998 which is in addition to reserves
Roscoe Postle audited all Exall Estimates
6.4 Historic Reserve Estimates
Table 6.3 summarizes the historic reserve estimates made on the Black Fox deposit.
Table 6.3 Historic Reserve Estimates

Year Proven Probable Total Proven & Probable Estimator
Tonnes Grade Oz Au Tonnes Grade Oz Au Tonnes Grade Oz Au
1996 499.0 11.14 179.0 499.0 11.14 179.0 Canadian Mine Development (Feasibility)
1996 477.0 10.70 164.0 477.0 10.70 164.0 Bharti Engineering Associates
1996 621.0 11.60 232.0 621.0 11.60 232.0 Posco Postle
1997 665.1 12.90 275.1 665.1 12.90 275.1 Posco Postle
1998 329.5 9.88 104.7 488.3 10.32 161.9 817.8 10.14 266.6 Exall
1999 283.8 8.48 77.4 553.2 9.50 169.0 837.0 9.15 246.3 Exall
2000 421.5 7.82 105.9 559.8 8.93 160.8 981.3 8.45 266.7 Exall
2001 302.5 8.45 82.2 475.2 9.21 140.7 777.7 8.92 222.9 Exall
Comparing the reserves estimated in Table 6.3 to historic production is important as it has implications
to the current grade modeling. First, it is apparent that the grade and tonnage estimates are not very
close to the actual production of about 1.1 million tonnes grading about 6 g Au/t of material processed.
The estimates between 1996 and 1997 ranged from a high of 275,000 ounces of gold to a low of 162,000
ounces. The final estimate in 2001 was for about 140,000 ounces, most of which is still in the ground.
All of the historic reserve estimates were for higher grades and less tonnes than were actually mined.
More dilution than planned may explain some of the differences, however we believe it is more likely
due to the nature of the gold in the deposit.
We believe that in order to accurately define grade, a much larger diameter hole than is practical is
required. Most of the mineralization is from visible gold that tends to concentrate in small areas in such
a way that a 2-3 inch diameter drill hole is more likely to miss the visible gold than hit it. If the drill
hole hits some visible gold it is more likely to represent too high a grade than would actually be found
during mining. The vast majority of the drill holes inside mineralized zones is very low grade but may
actually be ore grade if one could sample an entire 5 m strike length section of the zone. Many of the
underground stopes occur where drilling has failed to represent ore grade material. We reached several
conclusions that have implications to grade modeling.
The tonnage estimated above an economic cutoff grade will likely be underestimated due to
missed gold occurrences in the 2-3 inch diameter drill holes. Considerable dilution is introduced
into the grade model by missing areas of concentrated gold within the mineralized zones’
drilling. This is offset somewhat by high-grade hits that are likely overestimating local grade.
We believe that a 1-2 m hole would be required to accurately define the grade, however this is
economically impractical.
Mining to a cutoff grade may be difficult. Exall tried to mine to a 3-4 g Au/t cutoff grade but
came close to the grade predicted by about a 0.8 g Au/t cutoff grade.
The treatment of higher-grade material is important to address by cutting abnormally high grades
and restricting the influence of higher-grade samples. Estimates that use outlines of
mineralization at higher cutoff grades than the natural mineralization break of 0.2 g Au/t will
likely overestimate the grade of the deposit. Unfortunately there is no way of knowing where the
drill holes missed ore-grade gold, so we believe the models will always underestimate the
tonnage of the deposit.

7.0 GEOLOGIC SETTING
7.1 Regional Geology
Lithology
The Black Fox (former Glimmer) Mine is interpreted to be on the southern limb of a large-scale
anticline. The axial plane of this structure at the Black Fox property strikes roughly NW-SE. The Blake
River Group consists of calc-alkalic basalt, andesite, dacite and rhyolite flows and tuffs. It is the
youngest of the volcano-sedimentary rocks and stratigraphically overlies the Kinojevis Group. The
Kinojevis Group is a sequence of iron rich tholiitic volcanic rocks that occur on both sides of the Blake
River synclinorium. The Stoughton-Roquemaure Group stratigraphically underlies the Kinojevis Group
and is a mixture of ultramafic to basaltic komatiite lavas and Mg-rich tholeiitic basalts that are the host
rocks for the Black Fox gold zones. The lower boundary of this group is with calc-alkalic rocks of the
Hunter Mine Group. They consist of mainly calc-alkalic pyroclastic and flow rocks in the dacite-
rhyolite compositional range. The top of the sequence is defined by the appearance of komatiitic and
tholiitic lavas of the Stoughton-Roquemaure Group. Pre- to syn-kinematic granitic rocks occur
throughout the area, cross-cutting all older lithologic and stratigraphic units. The Porcupine Group of
wacke, siltstone and argillite sediments are the youngest in the region but are in fault contact with the
above mentioned volcanic groups. This group lies north of the Black Fox Mine.
Structure
The main structural feature on the property is the intersection of the Destor-Porcupine Fault Zone
(DPFZ) with the Ross Mine Syenitic Belt (RMSB). The DPFZ is a regional structural zone, which has
numerous gold deposits spatially associated with it in northeastern Ontario and northwestern Quebec. It
was first recognized in the early 1900s with the discovery of gold deposits in the Timmins area. The
DPFZ is traceable over a distance of at least 200 km, from Timmins in the west, to the Duparquet area of
Quebec to the east. It is of the same magnitude and significance, with respect to gold mineralization, as
the Cadillac and Casa Berardi Fault Zones to the north. The faults trend east to southeast and dip to the
south. They are deeply rooted regional trends that probably penetrate to the mantle, as indicated by the
associated ultramafics of the DPFZ and the Syenites of the RMSB. Zones of intense hydrothermal
alteration measured in thousands of feet are locally associated with these belts. These types of deep
rooted faults are considered to be the main channelway for the upward migration of deep fluids. Figure
7.1 illustrates the Regional Geology.
7.2 Local Geology
Most of the project area is rather flat and lacking in outcrops. Pleistocene overburden averages 20 m
thick and is composed of lacustrine clay, gravel and till.
A variably sheared, faulted, carbonatized and mineralized sequence of komatiitic ultramafic volcanics,
belonging to the Stoughton-Roquemaure Group strikes southeast across the property, along the southeast
strike of the DPFZ. This structure and the surrounding stratigraphy dip to the southwest at
approximately 45o. These altered and deformed komatiites are generally bleached to a light grey-buff
colour with ankerite-talc and ankerite-quartz-sericite-fuchsite assemblages. This alteration package is

underlain to the north by a thin, fine grained, green greywacke-type sediment unit, a thick sequence of
massive to pillowed tholeiitic mafic volcanics and lastly by the regionally extensive package of argillites
and wackes of the Porcupine Group sediments which underlie the northeastern portion of the property.
To the south and forming the hanging wall of the main ankerite zone are relatively undeformed very
fine-grained and green pillowed tholeiitic mafic volcanics with lesser intercalated black chlorite-
serpentine, chlorite and talc-chlorite altered komatiitic ultramafic flows.
Numerous syenitic and feldspar +/- quartz porphyry sills and dykes of various ages occur, primarily
within the main ankerite alteration zone. They are commonly massive to brecciated, silicified and pyritic
with occasional sericite and hematite alteration and a more common black chlorite alteration at the
contacts. They vary in colour from pink, grey, whitish, yellow, pale green and reddish. Within the more
strongly deformed green carbonate zones, fragments of these dykes frequently occur.
Very narrow massive, dark green to buff-green mafic dykes and sills commonly occur within the main
ankerite zone. They are generally weakly altered and probably post-date much of the alteration and
deformation. Diabase dykes are the youngest rocks in the area, occupying very late north-striking
crustal fractures. Figure 7.2 illustrates the local geology, while Figures 7.3 through 7.5 illustrate typical
cross sections through the deposit.

Figure 7.1 Regional Geology
Regional Geology of the Black Fox Mine Property

Figure 7.2 Local Geology
GEOLOGICAL MAP OF BLACK FOX MINE PROPERTY

August 14, 2006
7
Overburden
6

8
Ultramafic Volcanic
Rocks
Felsic
Intrusive
Rocks
Mafic Volcanic Rocks
Ankerite Alteration Envelope

1
3 Hole # Composite # From To True Width (m) Average Grade (g/t) SCALE
03BF109 #1 331.0 339.8 7.6 22.92
03BF063 #2 344.1 349.3 4.5 33.68 PLOT DATE:
03BF072 #3 389.5 391.0 1.3 19.67

DRAWN BY:
Figure 7.3 Typical Cross Section 10025E
03BF095 #4 380.4 384.3 3.4 7.52

03BF076 #5 49.8 51.8 1.8 4.52
Approximate Location and
03BF024 #6 45.7 49.0 3.0 363.84
Orientation of the Destor-Porcupine
Fault 03BF065 #7 16.4 22.5 5.5 91.10
03BF111 #8 142.4 143.6 1.1 13.00
SECTION NO.
LOOKING NW 10025E

Page 50
August 14, 2006
Overburden
6

Felsic
Intrusive
Rocks 4
Ankerite Alteration
7
Envelope
Ultramafic Volcanic Approximate Boundaries and Orientation of the

Rocks Destor-Porcupine Fault
Hole # Composite # From To True Width (m) Average Grade (g/t)

8
Mafic Volcanic 03BF042 #1 310.5 313.0 2.2 18.0 SCALE
Rocks 03BF051 #2 305.0 307.0 1.8 11.62
03BF034 #3 306.7 310.0 3.0 87.75 PLOT DATE:
03BF130 #4 93.3 98.1 4.3 13.58

DRAWN BY:
03BF130 #5 110.4 112.4 1.8 9.97
03BF084 #6 43.8 47.2 3.1 7.99

03BF039 #7 130.0 134.0 3.5 7.66
03BF039 #8 355.4 357.1 1.5 5.55
SECTION NO.
LOOKING NW

Page 51
August 14, 2006
Overburden
11
12
13
Hole # Composite # From To True Width (m) Average Grade (g/t)

Mafic Volcanic
03BF079 #1 348.0 350.0 1.7 9.37
Rocks 10

03BF040 #2 322.1 323.7 1.4 4.97
03BF027 #3 261.7 264.6 2.5 32.64
03BF030 #4 253.4 255.5 1.9 22.72

03BF030 #5 293.2 296.4 2.9 6.72
03BF033 #6 245.0 250.0 4.5 1.84

6 8
03BF033 #7 266.1 268.3 2.0 27.50
4 7
9 Ankerite Alteration Envelope 03BF036 #8 267.5 269.3 1.6 2.01
Ultramafic Volcanic Rocks 3
03BF036 #9 297.0 299.5 2.3 2.07
5
03BF128 #10 121.8 124.2 2.2 1.22

03BF103 #11 32.1 35.1 2.7 6.61

Felsic 2
03BF103 #12 56.3 58.8 2.3 6.52
Intrusive
Rocks 1 03BF103 #13 66.9 70.5 3.3 19.92
Approximate Boundaries and Orientation of the Destor-Porcupine Fault

LOOKING NW

Page 52
8.0 DEPOSIT TYPE
The Black Fox Mine is a former producing gold mine (Glimmer) which ceased production in 2001. A
total of 195,337 ounces of gold were recovered from 946,287 tonnes of material mined from
underground workings. The deposit lies along the prolific Destor-Porcupine Fault Zone (DPFZ), a
major, easterly trending deep-seated crustal feature which has numerous past and currently producing
gold mines associated with it and various splay faults. This structural zone hosts the numerous gold
deposits of the Porcupine camp, including the Stock and Aquarius deposits to the west and Holloway
and Holt-McDermott Mines to the east. Each of these deposits was in the 800,000 ounce range, with
many other mines located on the west end of the DPFZ exceeding 1,000,000 ounces. Many of the gold
deposits along the DPFZ extend to over 1000m below the surface. Some of these are blind deposits,
which do not reach surface.
Gold mineralization in all of these deposits is structurally controlled, as is the Black Fox deposit, and is
found in a variety of geological settings with different alteration styles. These include pyritic ankerite-
sericite +/- silica-albite altered mafic volcanics, green carbonate (fuchsitic) altered ultramafic volcanics
with quartz stockworks, pyritic, porphyritic to syenitic felsic intrusives and multiple stages of quartz
veins with free gold.
Although there are several different styles of mineralization along the DPFZ, the most important factor
is their close proximity to the fault and its related splay structures. The Black Fox deposit hosts most of
these different styles of mineralization. This will be discussed in more detail in the section on
mineralization below.
The Black Fox Mine workings extended down to approximately 200 m below the surface, with sparse
drill information provided prior to cessation of mining activity in 2001 by the previous operators. The
current drilling program is geared to outline additional resources below and along strike of the known
mineralization.

9.0 MINERALIZATION
Gold mineralization at the Black Fox deposit occurs in several different geological environments within
the main ankerite alteration zone, which has an indicated strike length of over 1000 m and a variable
true width ranging from 20 to over 100 m . This mineralized envelope occurs primarily within komatiitic
ultramafics and lesser mafic volcanics within the outer boundaries of the DPFZ. The auriferous zones
have several modes of occurrence, from concordant zones which follow lithological contacts and which
have been subsequently deformed, to slightly discordant ones which are associated with syenitic sills
and quartz veins or stockworks.
The three main types of gold mineralization noted at Black Fox are:
a) Low-sulfide mineralization associated with significant quartz veining and quartz stockwork
within strong ankerite + fuchsite alteration of ultramafic volcanic units (quartz-rich portions of
the AUV and CGR codes). ‘Green carbonate ore’ is included in this type. While characterized
by low-sulfide contents, small amounts of pyrite are typical of the mineralized zones. Multiple
phases of quartz veining and structural episodes, evidenced by cross-cutting veins, chloritic slip
surfaces in the quartz veins, and breccia textures, are typical of this mineralization style. Visible
gold is common in high-grade areas. Without visible gold, however, it is often difficult to
predict significantly mineralized versus unmineralized intervals. This type of mineralization is
most common in the footwall portion of the Destor-Porcupine fault zone (“DPFZ”).
b) Mineralization hosted within mafic volcanic units that is associated with significant fine-grained
pyrite (typically >~5%) and minor to moderate quartz veining (coded as BMV and pyritic
portions of MV). Quartz veins are typically parallel to foliation, and visible gold is
characteristically absent in this type of mineralization, referred to in the district as ‘flow ore’.
The mineralization is frequently, but not always, associated with bleaching of the mafic volcanic
rocks. This style is common in the footwall portion of the DPFZ in the eastern part of the 235-
level underground drilling.
c) Mineralization hosted in silicified felsic dikes. The host dikes include both quartz-feldspar
porphyries and finer-grained, possibly syenitic, dikes (FI code); the fine-grained dikes are more
commonly mineralized. Mineralization in the dikes is associated with increased silicification,
fracturing, and pyrite; some quartz veining is typically present. Dike-hosted mineralization is
common in the middle and hanging wall portions of the DPFZ, where dike intersections can be
correlated from hole to hole in many cases (in contrast to the blocks and lenses of felsic dikes
that occur in the footwall portions of the DPFZ).
Over 15 separate mineralized structures have been identified within the ankerite envelope to date
(Hoxha and James, 1998). The two main auriferous zones are the A1 at the hanging wall contact and the
C0 located at the footwall contact. The many other smaller zones located between these two generally
have less continuity and width and represent parallel, mineralized shears and faults. From previous
underground work, it appears that the sub-horizontal zones along the structure often have the greatest
thickness, in the order of 10-15 m, and highest grades. This suggests that zones of dilation are produced

during episodes of folding and structural movements. The majority of other mineralized zones and
quartz veins are in the 1-5 m range for width.
More than three generations of quartz veining have been identified in the Black Fox Mine workings.
Shear/fault zones paralleling the main mineralized envelope are responsible for the location and
formation of these quartz vein and stockwork zones locally. The presence of sigmoidal vein structures,
multiple quartz injections and re-sheared vein material with chloritic slips indicate complex and repeated
structural movements at the time of formation. Visible gold commonly occurs as fracture-fillings within
the veined zones associated with the chloritic slips. Gold mineralization is in places erratic within the
quartz stockwork zones, probably due to the fact that only certain vein sets carry gold, while others are
barren.
Gold mineralization has been encountered in drill core at depths of 700 m to date and, since the host
ankerite zone continues further down, it is reasonable to expect that additional mineralization will be
encountered with deeper drilling.

10.0 EXPLORATION
Noranda Exploration Company, Ltd. (Noranda) undertook detailed geological mapping of the property
and much of the surrounding area. This data has provided a very good base of information from which
to determine structural trends and the location of the most favorable stratigraphic units. Apollo Gold is
compiling and adding to this geological database and will use it for determining targets.
Past owners of the property have had a number of different geophysical surveys completed. In 1989,
Noranda had Exsics Exploration Ltd., Timmins, Ontario, ran a total field magnetic survey over most of
the property. That same year Noranda also had Lamontagne Geophysics Ltd. complete an Inductive
Source Resistivity survey and had R.S. Middleton Exploration Services run a conventional Induced
Polarization survey over portions of the property. An inter-company report written by Brian Groves
dated Nov. 1989 states: “The magnetometer data have aided in broad-scale lithological identification.
The I.S.R. data defined areas of anomalous resistivity while weak to moderate zones of anomalous
polarizability have been defined by the I.P. data.”
Eventually this information helped lead Noranda to the discovery of what is now the Black Fox Mine. It
appears that once Noranda made the discovery, they concentrated on it and did not address testing the
remaining anomalies.
During the period between 1989 and 1994 Noranda (later called Hemlo) completed 142 surface diamond
drill holes. Between the period of 1995 and 1999, Exall completed another 142 surface diamond drill
holes. With the development of the Glimmer Mine (Apollo later changed the name to Black Fox), Exall
completed 720 underground diamond drill holes in the deposit.
In 1997, Glimmer Resources, Inc. had JVX, Ltd., of Toronto Ontario, complete another Induced
Polarization survey over the area around the Black Fox Mine site. This was a small survey that appears
to have been designed to help find new ore zones adjacent to the then current mine workings.
During the spring of 2003, Apollo Gold Exploration, Inc. contracted with Quantec Geophysical, Inc.,
Toronto, Ontario, to complete an Induced Polarization survey covering the entire property. Lines were
spaced every 200 m with 100 m dipole spacing. This survey has shown many chargeability and
resistivity anomalies along both the Destor-Porcupine Fault Zone and the northwest projection of the
Ross Fault. The Ross Fault is the host for the Ross Mine, located approximately 7,500 m southeast of
the Black Fox Mine. In addition to these, a number of north-south trending anomalies were found. The
intersections of these trends are considered to be prime exploration targets. It appears that the data from
the earlier Noranda magnetic survey will also be valuable in defining exploration targets. The highly
magnetic anomalies may help in mapping the basalt and ultramafic units on the property. In addition to
this, low magnetic trends may be indicative of hydrothermal alteration that destroyed the magnetic
qualities of the surrounding rocks. Figure 10.1 illustrate the results of the geophysical survey.
Exploration on the Black Fox property was completed on 12.5 m to 25 m fence lines to outline the
known mineralization and away from known areas, looking for areas of new mineralization from both
the surface, and from underground on the 170 and 235 levels (meters below the surface). By the end of
2005 Apollo completed 449 surface diamond drill holes on the property totaling 136,391.6 m. A 1,250
m underground drift was developed 235 m below the surface, with drill stations for an underground
drilling program. This underground drill program completed about 75,000 m of underground diamond
drilling from 371 core holes. The underground drilling was successful in defining several areas with
high-grade mineralization that require additional drilling. The largest of these zones is found in the
“flow ore” on the eastern edge of the property below the 9600 elevation. This “flow ore” mineralization
is open to the east as the drilling was extended to the eastern extent of the access drift.
The initial portion of the Apollo surface drilling program concentrated on finding new ore zones below
the Black Fox known resources, along strike and adjacent to the known zones. The targets were the
intersection of secondary faults with the Destor-Porcupine Fault Zone (DPFZ) and also dilation zones
within it. The mineralization is so tightly controlled by structures that a hole a few meters away could
miss a high-grade zone. Fans of NQ-size drill holes were drilled to test for new ore shoots. The fans
were spaced approximately 25 m along strike and the intersections of the holes with the DPFZ were
planned to be approximately 25 m apart. The result of this program was the identification of a number
of small, high-grade ore shoots that generally plunge at a 20o-40o angle to the southeast or southwest,
along the DPFZ. This is consistent with the intersection of two 45o-70o dipping faults or with a zone of
dilation along a fault that has both horizontal and vertical movement. Many of these ore shoots are still
open with depth. A near-surface portion of high-grade mineralization was drilled on 12.5 m spacing to
improve the definition of this higher-grade mineralization.

Figure 10.1 Apollo Geophysical Survey

11.0 DRILLING
11.1 Drilling Summary
A total of 1,300 drill holes have been completed on the project through December 31, 2003. Table 11.1
illustrates the drilling by company. Figure 11.1 is a surface plan showing the surface drilling on the
property. Figure 7.2 is a plan map showing the underground drilling.
Table 11.1 Black Fox Property Drill Summary
Company Period Type Number Meters

(All Core)
Noranda 1989-1994 Surface 143 28,180.8
Exall 1995-1999 Surface 142 21,288.7
Apollo 2002-2005 Surface 449 136,391.6
Subtotal Surface 734 185,861.0
Exall 1996-2001 Underground 721 63,059.2

Apollo 2004-2005 Underground 371 75,704.5
Subtotal Underground 1,092 138,763.6
Total Black Fox 1,826 324,624.6
Table 11.2 shows the database summary for historic and Apollo drilling. The coordinates shown in the
summary reflect a local grid developed by Exall.
Table 11.2 Black Fox Property Database Summary
Apollo Drilling Historic Drilling

x y z x y z
Item Item Hole Depth East North Elevation Hole Depth East North Elevation
Minimum North 04BF320 671.0 10,100.0 8,675.0 9,995.5 75 197.0 8,900.7 8,898.9 10,000.0
Maximum North 05BF411 374.0 10,814.5 10,523.1 9,999.0 62 76.0 10,649.3 10,479.3 10,000.0
Minimum East 03BF279 692.6 9,550.0 9,220.0 9,996.5 75 197.0 8,900.7 8,898.9 10,000.0
Maximum East 04BF388 252.0 11,049.8 10,375.0 10,000.1 292-99 274.2 10,693.1 10,176.6 10,003.3
Minimum Elevation 235-214 206.0 10,025.5 9,797.6 9,765.3 19-1 126.0 10,018.0 10,006.4 9,813.1
Maximum Elevation 04BF349 680.0 10,474.4 9,650.8 10,010.1 292-99 274.2 10,693.1 10,176.6 10,003.3
Minimum Depth 235-257A 9.0 10,061.8 9,811.7 9,765.9 14-80 5.5 10,016.6 9,983.8 9,860.9
Maximum Depth 04BF360 995.0 10,470.4 9,580.3 10,008.0 280 851.0 9,901.1 9,824.2 10,000.0
There are a total of 176,525 assay intervals contained in the database.
11.2 Historic Diamond Drilling and Logging
From 1989 to 1993 Noranda drilled 142 NQ-size diamond core holes totaling 27,930 m (91,610 ft), in
this area. These holes were logged by a geologist and split for assay. Noranda hole 61a is in the

database as the 143rd hole drilled by Norada, but was lost and has 0 ft of core drilling noted in the
database. Exall drilled an additional 142 NQ-size surface core holes totaling 21,295 m (69,848 ft), from
1994 through 1999. Exall resurveyed the collar coordinates of most of the Noranda drill holes, with
generally good agreement in the coordinate conversion between the Noranda and Exall data. Exall also
drilled 720 underground core holes that totaled 62,827 m (206,072 ft). They were generally NQ in size,
although they occasionally had to reduce to BQ-size in bad ground. Exall’s drill core was also logged
by a geologist and split to prepare intervals for assaying. Exall, as part of their underground drilling
program, managed to extend two NQ core holes into significant mineralization below 200 m from the
surface. Unfortunately they had to be drilled down the dip of the DPFZ and are of limited value.
11.3 Apollo Diamond Drilling and Logging
Norex Drilling International from Porcupine, Ontario, completed most of the Black Fox property drilling
for Apollo generally starting each hole with NQ-size core. The drill holes provide core samples of
potentially mineralized ground, mainly within the Destor-Porcupine Fault Zone. Ground conditions for
core drilling have been very good.
The core is removed from the wire line inner barrel and placed in wooden core boxes. Each box can
hold up to six meters of NQ core. The depth at the end of the core run, along with the length of the run
and the amount of core actually recovered, is written on wooden blocks which are placed in the box at
the end of the core. When the box is full, the hole number, along with the beginning and ending depth is
written on the outside of the box. A wooden lid is then placed on the box and the box is sealed with
wire. The core is stacked at the side of the drill until it is picked up by representatives of Apollo Gold
Exploration, Inc. During this time the core is under the direct supervision of the driller.
The core samples are picked up by Apollo personnel each morning and at various times during the day
as necessary. It is loaded into a company truck and taken to the core logging facility in Matheson,
Ontario, approximately eight kilometers away, until a facility was constructed on the project site. The
core is then unloaded from the truck, the wire ties are removed and the core is inspected for any damage
that might have occurred during transport. Each box is then placed in racks within the core logging
facility to await logging by Apollo geologists. When a geologist begins logging a hole a logging form is
generated within a computer. Data regarding the hole, such as depth, date logged, location and the
geologist responsible for the hole are entered. This form will also be where the geologist enters
geological and geotechnical attributes as the hole is logged. All logging is done electronically with no
hand written data. This eliminates a separate data entry step and the subsequent errors that it can
introduce. The geologist takes boxes of core for the hole from the rack and places them on the core
logging table. The lids are removed and placed outside for later reuse. The pieces of core are then
reassembled, within the box, just as it would have come out of the hole. The core is then measured and
that measurement is compared to the core depth markers placed in the box by the drillers. This is a
check against any lost or missing core that was not accounted for by the drillers. All of this data, along
with all geological data, are entered into the computer spread sheet by the geologist. Once the core has
been reassembled, it is digitally photographed on the logging bench. This digital record is stored in the
computer files for that hole. All of the geological information is backed up on the server daily.

The geologist marks the core for splitting with a grease pencil and assigns each sample interval with a
sample number. From this point until the assays return from the lab all references to the sample are by
this number only. The core is then sent to the splitting room where technicians saw the core sample in
half with a diamond saw and place it in a bag which is marked with the sample number. Blank and
standard samples are inserted approximately every twenty samples and are numbered in sequence with
the core samples. The samples are then stored inside the core facility until they are picked up by
Swastika Laboratories from Swastika, Ontario. The samples are placed into their truck, with each
sample being checked off a list as it is being loaded. The half core that remains in the core box has the
lid replaced and is placed back in the rack by the technician. When a truck load of split core has been
accumulated, it is taken back to the Black Fox mine site where it is labeled with a stainless steel tag that
has the hole number and footage imprinted and placed in outside, covered, storage racks.
All holes have the collars surveyed and are surveyed for deflection with a Reflex E-Z Shot digital tool.
Measurements are taken approximately every 50 m down the hole. Occasionally a reading will be taken
near a particularly strongly magnetic rock unit and gives a spurious result. The geologists review all
surveys and any bad readings are discarded. As a check, three holes were re-surveyed using a Maxi-
bore gyroscopic tool. The survey duplicated the E-Z Shot survey very well. On average, the E-Z Shot
gave readings that were within 3.1% on bearing and 0.4% on dip from the Maxi-bore survey
information.
The Apollo drilling has concentrated to develop two main areas of the mineralization. The first is the
near-surface area of the Black Fox deposit that may be minable by open pit methods. About half of the
surface drill holes were completed to test the thickness and grade of the near-surface mineralization.
Drilling has been along sections oriented 36o azimuth and at inclinations of 45o to 50o. This places the
drill holes approximately perpendicular to the DPFZ. For this near-surface mineralization, the shoots
generally plunge at -40o s to the southwest within the DPFZ. Because of the shallow nature of the
mineralization, holes have been drilled individually to reach specific targets and not as fans as were
required for the deeper targets.
The second area is the mineralization that is down dip of the area mined by Exall. The Destor-
Porcupine Fault Zone, in the deeper area, has the same southeasterly strike, but the dip is at a steeper
average of 60o. The mineralization still occurs along structural intersections and at dilation zones along
the fault. These tend to plunge at about 40o to the southeast or southwest. In this area of steeper dip
along the fault, the shoots tend to be smaller, tighter and less continuous than seen near the surface. The
holes to test this area were drilled from the surface and underground in fans spaced approximately 12.5
to 25 m apart, designed to penetrate the DPFZ. Eventually, more tightly-spaced drilling from
underground platforms will be required to improve the definition of the shape, extent, and grade of the
deposit.

Figure 11.1 Surface Drill Plan
Reno Nevada
APOLLO GOLD
Black Fox Project
Surface Drill Hole Map
Matheson Ontario

Figure 11.2 Underground Drill Hole Plan Map
Reno Nevada
APOLLO GOLD
Black Fox Project
Underground Drill Hole Map
Matheson Ontario

12.0 SAMPLING METHOD AND APPROACH
12.1 Summary
All drill hole sampling on the property has been by diamond drilling, generally obtaining NQ-size core.
A total of 284 surface diamond drill holes and 720 underground diamond drill holes have been
completed by prior operators. Apollo completed an additional 449 surface drill holes and 371
underground diamond drill holes. A total of 3,659 chip sample location are entered into the database
containing a total of 21,002 samples.
Exall operated the Glimmer Mine which produced about 1.1 million tonnes grading about 6 g Au/t that
were contract milled. The underground sampling consisted of chip samples on the face of the workings
and muck samples taken by the miners. Discussions with Apollo personnel who were also employed by
Exall indicated that ore control was an issue at the time Exall operated the property. If visible gold was
seen in a round the round was shipped as “ore”. Visible gold was reportedly observed in about 50% of
the rounds that Exall mined.
12.1.1 Black Fox Deposit Sampling Issues
coarse gold in the deposit, and result in samples that tend to contain less gold than is actually present.
They are actually the same problem and are based on sample size issues and coarse gold.
The first issue is to get a large enough sample to represent the area sampled. The gold at the Black Fox
deposit appears to be concentrated in small areas. When the gold is concentrated in small areas, drill
hole samples will occasionally get too much gold in the sample when the area of concentration is
intersected or more often, miss the area of concentration and get too little gold in the sample. The core
holes that form the basis for the resource and reserve estimate are too small to obtain a representative
sample. Some samples may even appear to be waste without the concentrated gold. It is likely that
holes several meters in diameter would be required to obtain representative samples of the deposit.
MDA reviewed areas that were penetrated by drill holes prior to mining, and commonly areas that were
stoped appeared to be un-mineralized based on the drilling.
The second problem is getting the representative amount of gold in the sample pulp once the sample has
been obtained. Gold particles up to 0.15 cm have been observed and particles of 0.06 cm are very
common (Pitard, 2005). The proper sample size is required in order to get a representative sample
again, but this time we have all of the gold contained in the sample somewhere in the core. With coarse
gold it is easy to create sub-samples that contain too many or too few gold particles if the sample size is
not based on the size of the gold particles in the deposit. In order to sample the 0.15 cm gold particles
that occur at Black Fox, samples of up to 109 kg must be processed in their entirety (Pitard, 2005). If
the sample contains 0.06 cm gold particles, which commonly occur in the deposit, a 7 kg sample must
be processed in its entirety (Pitard, 2005). These sample sizes are much larger than the typical 30 gram
fire assay sample or even the generally larger than the 1000 gram screen metallic assay sample. Once
again, the samples result in a few assays containing too much gold, with far more containing less than is
actually present in the whole sample. Francis Pitard’s report on the sampling issues is shown in
Appendix B. A very interesting website with considerable information on coarse gold can be found on
the Bendigo Gold Mine website: http://www.bmnl.com.au . This website contains a number of technical
papers regarding coarse gold.
in grade, but far more that are too low in grade. Francis Pitard concluded in his 2005 report on Black
Fox mineralization that:

database..
MDA believes that the both the size of the sample to measure the gold in the deposit and the size of the
sample to measure the gold in the sample are too small, and will result a database where some samples
represent a higher sample grade than is present at the sample location, but many samples represent too
low a grade than is present at the sample location. MDA concurs with Pitard’s conclusion, that the drill
hole data is likely biased and will likely underestimate the contained gold within the deposit.
12.2 Noranda Sampling
Noranda drilled a total of 142 NQ-size diamond core holes totaling 27,930 m from 1989 through 1994.
All holes were surveyed at the collar and had acid etch tests done to measure the dip. A Tropari survey
was run at the bottom of a few of the deeper holes to measure deviation. The lack of a down-hole
survey on most of these holes could be a source of error in drill hole location, especially the deeper
holes.
Core recovery was apparently very good as few recovery problems were listed in the logs. The core was
brought to the surface and taken to Noranda's local logging facility. The core was logged for geology
and geotechnical parameters and then cut in half with a diamond saw. The sample was then sent to
either Swastika Labs or Chemex Labs in Rouyn, Quebec.
12.3 Exall Sampling
12.3.1 Exall Diamond Drilling
All drill core was NQ-size, unless ground conditions required reduction to BQ. Diamond drilling was
used to define an existing ore body, find new ore zones and define the lithology between two holes. The
surface drill holes were down-hole surveyed, however, the underground holes were not surveyed for
down-hole deflection, therefore the bearing and inclination at the collar has to be used for the entire
underground drill hole. For this reason, several of the underground holes appear to be located at
incorrect locations on the drill hole cross section maps.
The core was brought to the surface where the geologist logged and sampled it. The core was split in
half with a diamond saw. Prior to the installation of the mine site laboratory, Techni-Lab provided
sample preparation of a one assay ton (30 gram) sample and completed a fire assay of the sample. All
samples above 34.3 g Au/t were check assayed, as well as each 20th sample.
When the mine site laboratory was operational, they completed the analysis of the split core. Techni-
Lab assayed the occasional overflow that the Exall lab could not handle.
12.3.2 Underground Mine Sampling
Six (6) methods of sampling were used in helping to grade existing and advanced rounds underground.
Of those mentioned below, only diamond drilling is used in resource/reserve calculations. All others
were used for daily grade control and ore projections.
Chip Sampling:
o Horizontal sampling is used depending on the lithology. Samples were taken at chest
height over 1.0 m intervals if the geology stayed the same or within the rock type
interval, as shown in Figure 12.1. Samples were taken starting from left to right (to be
consistent).
Figure 12.1 Horizontal Chip Sampling

o Vertical sampling was used if the rock lithology was multiple, narrow and horizontal in
most cases. Samples were measured left to right and from the bottom up. Line spacing
was 1 m apart, as shown in Figure 12.2
Figure 12.2 Vertical Chip Sampling
Grab Samples: Grab samples are samples taken at random from muck piles underground. This
was done when a round was recently blasted and not mucked out. Samples were taken only
under secured ground.
Muck Samples: The method of sampling muck samples ideally would be to draw 2 lines (1/3
and 2/3 of the way) across the pile lengthwise and sample every 1 m. This was not done at the
mine which used two methods to sample muck from each round.
o After the truck was loaded underground the driver would take random samples from the
back of his truck.
OR
o The muck from the round was dumped in a designated area on surface or underground
and the geologist would take samples from the pile.
Test Holes or Sludge Holes: This procedure was used to extract the sludge from the drill holes
made by the jumbo drill. Three samples were taken every 1/3rd of the steel and were deposited in
a sample bag. This was used to detect the grades (after the samples were analyzed).
Bazooka Drilling: This was a one person, hand-held core drill that was capable of taking small
samples over a limited depth. It is similar in size to a standard jackleg drill. Core logging was
done using “DrillPad” software. This data is not in the database. The core size of the drilling
with the Bazooka was AQ and was used to establish the advance grade of the next round and to
grade the immediate surroundings. The maximum depth of the Bazooka drilling was limited to
less than 100 ft.

Specials: Specials were samples taken by the geologist. These may have been grabs or chips
taken at random, that the geologist may have believed had the potential for grade.
Diamond drill core, chip and surface muck samples were used for grade control purposes. Underground
muck samples taken by the truckers tended to result in sample biases due to unsupervised sampling.
All samples taken were issued a tag, which was assigned a sample number. Samples were then sent to
the Exall mine laboratory for analysis. Bulk sampling was proposed for grade control and sampling.
12.3.3 Exall Assay Lab Procedures
Blank samples (samples that have no assay values) were introduced with regular samples to verify the
accuracy and to see if any contamination was present at the lab. Labs automatically ran their own
internal random checks on samples.
Split assay pulps were sent to an external lab for comparison to verify the accuracy of the Exall mine
site laboratory. From Jan. 27 to Feb. 25, 1999 a total of 370 samples were sent to Techni-Lab in Ste.
Germaine Boule, Quebec. The difference between the Exall Lab and Techni-Lab was an average of
1.45%.
12.4 Apollo Gold Sampling
Core is logged and sampled at the core logging facility in Matheson. Samples from the split core remain
in the logging facility until they are picked up by representatives of the assay laboratory. Apollo sends
the bulk of the core samples to Swastika Laboratories Ltd. (Swastika). A smaller number of samples are
sent to the SGS laboratory in Rouyn, Quebec.
Drilling is done at approximately 25 m spacing. Sampling intervals are controlled by geological

boundaries. The maximum assay interval in the unaltered hanging wall and footwall rocks is 1.5 m.
An ankerite alteration envelope encloses the mineralized areas. Areas of strong ankerite alteration are
sampled at 0.6-1 m intervals. Suspected ore zones (Green-carbonate rocks with quartz-ankerite
stockwork, or pyrite-rich felsic dykes) are sampled at 0.3-0.6 m intervals. Less than 0.3 m samples are
discouraged. Visible gold is common within the quartz-ankerite stockworks in the green-carbonate
zones.
The gold is generally located within the quartz and carbonate zones. Very little of the gold is associated
with clay. Therefore, flushing of the gold while drilling or splitting is less of a problem. Also, the ore
zones, as well as the wallrock, are very competent with very good recovery.
12.5 Sample Statistics
Table 12.1 summarizes the statistics of the various drill programs inside the mineralized zones, while
Table 12.2 shows the assay sample statistics outside the mineralized zones.
Table 12.1 Sample Statistics by Company in Mineralized Zones
Item Company Valid N Mean Minimum Maximum Variance Std.Dev. C.V

g Au/t Apollo - Surface 8,416 3.84 0.00 2969.41 1609.582 40.120 10.46
g Au/t Apollo - Underground 7,626 3.92 0.00 1941.63 1034.030 32.156 8.20
g Au/t Exall - Surface 2,971 3.28 0.00 650.00 414.550 20.361 6.21
g Au/t Exall - Underground 11,487 3.24 0.00 3448.67 1679.689 40.984 12.63
g Au/t Noranda - Surface 2,660 2.65 0.00 245.35 108.315 10.407 3.93
g Au/t - Capped Apollo - Surface 8,416 2.86 0.00 175.00 118.564 10.889 3.81
g Au/t - Capped Apollo - Underground 7,626 2.91 0.00 175.00 115.816 10.762 3.70
g Au/t - Capped Exall - Surface 2,971 2.65 0.00 175.00 109.482 10.463 3.95
g Au/t - Capped Exall - Underground 11,487 2.14 0.00 175.00 67.413 8.211 3.84
g Au/t - Capped Noranda - Surface 2,660 2.43 0.00 120.00 62.544 7.908 3.25
Assay Interval Apollo - Surface 8,417 0.69 0.10 1.70 0.060 0.245 0.36
Assay Interval Apollo - Underground 7,627 0.75 0.30 1.50 0.051 0.225 0.30
Assay Interval Exall - Surface 2,971 0.86 0.02 10.00 0.130 0.360 0.42
Assay Interval Exall - Underground 11,487 0.88 0.07 6.00 0.095 0.307 0.35
Assay Interval Noranda - Surface 2,662 1.14 0.20 2.20 0.090 0.301 0.26
Table 12.2 Sample Statistics by Company outside of Mineralized Zones
Item Company Valid N Mean Minimum Maximum Variance Std.Dev. C.V

g Au/t Apollo - Surface 49,611 0.04 0.00 59.97 0.205 0.452 12.20
g Au/t Apollo - Underground 36,518 0.03 0.00 7.48 0.010 0.100 3.82
g Au/t Exall -Surface 9,295 0.07 0.00 8.27 0.020 0.140 2.12
g Au/t Exall - Underground 36,142 0.10 0.00 106.67 0.688 0.830 8.31
g Au/t Noranda - Surface 7,885 0.09 0.00 111.70 1.466 1.211 12.84
Assay Interval Apollo - Surface 49,612 0.91 0.07 9.65 0.102 0.319 0.35
Assay Interval Apollo - Underground 36,527 0.82 0.15 5.40 0.046 0.215 0.26
Assay Interval Exall -Surface 9,296 0.96 0.07 25.55 0.564 0.751 0.79
Assay Interval Exall - Underground 36,142 0.96 0.05 84.00 0.954 0.977 1.02
Assay Interval Noranda - Surface 8,118 1.18 0.10 5.90 0.096 0.311 0.26

12.6 Sample Distribution
The sample distribution is shown in Figure 12.3 for the different exploration programs inside the
mineralized zones. The Noranda surface drilling is missing the high-grade material found in all the
other programs. This may be due to the small sample size of the assay pulps.
Figure 12.3 QQ Plot of Drill Programs

13.0 SAMPLE PREPARATION, ANALYSIS, AND SECURITY
13.1 Summary
After the core was logged, the core samples were split by a diamond saw to obtain the assay lab sample.
The 50% split was bagged at the site and either picked up by assay lab personnel or shipped to the assay
lab. The sample was dried, crushed, split, pulverized, and blended to obtain fire assay pulps. The labs
prepared ½ (15g) to 1 (30g) assay ton samples for assay. Most of the assays were completed by fire
assay methods with a gravimetric finish.
13.2 Sample Security
Samples were sealed in bags at the site and shipped or collected by commercial laboratory personnel.
13.3 Drill Sample Preparation and Analysis
13.3.1 Noranda Drill Sample Preparation and Analysis
The first phase of the Noranda drilling was processed by Min. En Laboratories and TSL (holes 1-17).
Noranda then used Swastika or Chemex Labs for analysis of the remainder of the samples. Noranda
instructed the assay lab to prepare a ½ assay ton sample for analysis, and to re-run samples if the initial
analysis was greater than 2 g Au/t on a 1 assay ton sample.
MDA believes that this procedure may have missed some mineralized zones due to the small initial
sample size and coarse gold present in the deposit. According to the reserve report written by Roscoe
Postle Associates, Inc. in 1996, “Examination of the check assay data and assay statistics indicate
relatively poor repeatability for replicate assays on the same pulp and for duplicate assays on different
pulps. This is likely due to a coarse gold effect in the Glimmer mineralization. The poor repeatability
of check assays adds an element of uncertainty to the reserve estimate and indicates an area for
improvement in future sampling”.
The Noranda assay lab used the flow sheet shown in Figure 13.1 to prepare and assay the samples
received from Noranda, most of which weighed from 1 to 5 kg.

Figure 13.1 Swastika or Chemex Lab Sample Preparation and Assaying Procedure for Noranda
Dry
Jaw Crush (80% -10 mesh)
Riffle Split 1-5 kg
Pulverize (95% -100 mesh)
Blend, Roll, Split 400 g original pulp
1/2 AT Fire Assay

Gravimetric Finish
1 AT Fire Check > 2 g Au/t
Check Assay on > 2 g Au/t
13.3.2 Exall Drill Sample Preparation and Analysis
Exall utilized Techni-Lab to complete the assaying of their drill holes until the mine site lab was
completed. After completion of the mine site lab in February 1999, most of the assaying for the muck
and chip samples was completed at the on-site laboratory, with Techni-Lab used for the drill hole
samples, overflow and check assaying.
Techni-Lab dried and crushed the sample to 10 mesh, where a 300 gram split was taken. The 300 gram
sample was pulverized to 80% -200 mesh. A one assay ton (30 gram) sample was split from the
pulverized material for fire assay with AA finish. Exall requested checks on all assays exceeding 34.3 g
Au/t. The Techni-Lab internal checks agreed well with the original sample.
13.3.3 Apollo Drill Sample Preparation and Analysis
Apollo saws the core and ships one half of the drill core to either Swastika or SGS Laboratories. The
labs prepare a one ton (30 g) sample for fire assay with a gravimetric finish by crushing the core to -10
mesh and taking a 400 g split to pulverize and prepare the sample pulp. As a quality check, the coarse
reject sample material from each mineralized zone, having an average grade over one gram, is sent to
the other lab. The samples are repulped from coarse rejects and reassayed using a 30 g fire assay with a
gravimetric finish. By doing this, a check is done on the entire process, from sample prep through the
gravimetric finish. All samples, whether initially reported as high-grade or low-grade, are checked.
Currently, samples are being selected and run for a screened metallic fire assay. This data will also be
compared with the results of the two conventional fire assays.
Digital e-mails of results are sent from Swastika Laboratories along with certificates of Analysis to the
Black Fox Mine. Along with the digital e-mail of the assays results a faxed copy of the assay certificate
is sent from Swastika Laboratories. The faxed copy of the certificate is sent back to Apollo Gold
Exploration Inc. staff for hole delineation. The faxed certificates, with segregated holes are checked
against the digital file for errors. The faxed copy, once confirmed by Apollo to be correct are stamped
complete, and added to the audit file for back referencing. The digital assay result file is cut from the e-
mailed file and pasted on the core logs generated for logging of Black Fox core. Once pasted the sample
numbers and the pasted assays are checked again to ensure no pasting errors occurred. Once assays are
pasted onto the drilling logs and confirmed they are saved as a separate file. If the logs are complete
with all assays, they are saved as a .DC file. The DC files are put into a locked folder on the Black Fox
data base which can only be accessed as a read-only file. All editing of these files must be done through
the administrator (project manager). Once the file has been saved to this folder the file is sent to
Apollo’s offices in the USA for modeling and reporting purposes. If the assays results are not complete
the file gets saved as a “Pending” file, and are stored in incomplete assays folder until final assay results
are posted. All reported assays are final assays, and original certificates of analysis are stored in a
separate binder and stored in a fire proof safe at the Black Fox Mine Site. All assay reporting goes
through the Black Fox, Project Manager.
13.3.4 Exall Chip Sample Preparation and Analysis
The Exall mine lab used a jaw crusher to reduce dried samples to about 1.9 cm, which is followed by a
cone crusher to reduce the sample to 0.5 cm. The sample is split to obtain a 300 g sample to pulverize to
100-200 mesh. A 25 g pulp is fire assayed to obtain the sample grade for the muck and chip samples.
After some time the Exall laboratory converted to a one assay ton (30 g) sample and fire assay with a
gravimetric finish. Blanks were inserted every twenty samples and standard samples were inserted
every ten samples.
13.4 QA/QC, Check Samples, Check Assays
13.4.1 Summary
The Black Fox deposit contains a significant portion of coarse gold that is difficult to sample. Obtaining
a large sample is likely the key to representative assaying. Limited testing (593 samples) by Apollo is
showing higher assays (about 10%) for samples processed by metallic assay than by fire assay.
The historic check sampling on the project appears to be weak, especially for a deposit that is known to
contain coarse gold. The Noranda checks appear to be limited to checks on the same assay pulps. The
Noranda checks are based on new assays made from the same assay pulp and show reasonable
agreement on the mean grade, however individual sample variance is high. The Exall check assay
program is nearly non-existent except for checks on the same assay pulps. Exall completed several
checks with the Macassa Mill which indicated poor agreement with the original assay.
Apollo is planning a significantly improved check assay program where there is a check assay on each
mineralized zone. In addition to the blank and standard check samples, Swastika runs their own internal
check samples. All of the samples are run for a 30 g fire assay. Potential ore zones are then selected
from the fire assay results by Apollo personnel and these intervals are re-run with a 1,200 g screened
metallic assay. Two of these samples are selected out of each ore zone at random and the rejects are
sent to SGS laboratories in Rouyn, Quebec where they are re-prepped and run for a second screen
metallic assay. This is used as the quality check on the first assay set run by Swastika. All of the assay
data is sent to the Black Fox Mine in digital format where it is merged with the geological spread sheet
for that hole. Additionally, Apollo plans to complete metallic check assays on selected intervals.
13.4.2 Noranda Check Assays
The Noranda data includes 196 reruns of ½ assay ton (15 g) samples of the original ½ assay ton samples.
The reruns average 4.6% lower grade than the original samples, as shown in Figure 13.2. The samples
over 2 g were noted to be rerun by a 1 assay ton (30 g) sample, however most of this data is not in the
digital database. Reruns of 80 samples indicate the reruns of one assay ton are higher in grade by about
5% than the original ½ assay ton sample, as shown in Figure 13.3. Roscoe Postle Ascts. (RPA) (1997)
reports that Noranda checked about 10% of the assays.
Figure 13.2 Noranda ½ Assay Ton Reruns
160
140
120
y = 0.9192x + 0.5054
2
Check (1/2 AT) g Au/t
R = 0.9462
100
80
60
40
20
0
0 20 40 60 80 100 120 140 160
Original Assay (1/2 AT) g Au/t

Figure 13.3 Noranda 1 Assay Ton Reruns
140
y = 0.8832x + 2.2009
R2 = 0.7889
120
100
Check (1 AT) g Au/t
80
60
40
20
0
0 20 40 60 80 100 120 140
Original Assay (1/2 AT) g Au/t
The Noranda assay sample distribution is missing the high grade found in all the other drill programs
shown Figure 12.3. MDA recommends that check assays should be completed on the Noranda core that
remains by metallic assay. These should be completed on intervals inside mineralized zones and just to
the outside of these zones.
13.4.3 Exall Check Sampling
Techni-Lab batched samples in groups of 24. Each group contained at least 1 blank sample, 1 standard
sample and replicate samples. Routine checks were taken on about 5% of the samples and all samples
over 34.3 g Au/t, however the check assay data is not present in the assay database. The statistics from
past programs however are included in past RPA audits of the deposit resources and reserves for Exall.
These indicated very good agreement between the Techni-Lab original assay and the Techni-Lab
duplicate on thousands of checks of the same pulp.
Figure 13.4 illustrates a relatively good comparison of 365 muck samples where Exall provided the
original assay and Techni-Lab provided a check. The average grade of this comparison from the two
labs compare within 1.3%, however the average difference was about 18%.
However, some of the Exall check assay information indicated poor agreement. A check of chip and
muck samples completed at Exall’s on-site facility and the Macassa Mill is shown in Figure 13.5. MDA
believes that this comparison is based on reject samples from correspondence between the Labs. The
average of these samples indicate the Macassa assay is higher by about 7%
Figure 13.4 Comparison of 365 Muck Samples Checked by Techni-Lab
75
70
65
60
55 y = 1.0491x - 0.2893
50 R2 = 0.9351
Techni-Lab Assay (g Au/t)
45
40
35
30
25
20
15
10
0
0 5 10 15 20 25 30 35 40 45 50 55 60 65 70 75
Exall Assay (g Au/t)
Figure 13.5 Macassa Mill Checks on Chip and Muck Samples
24
22
20
18
y = 0 .59 0 9 x + 2 .9 6 54
16 R 2 = 0 .3 53 6
14
12
10
0
0 2 4 6 8 10 12 14 16 18 20 22 24
Ex a ll F i re

13.4.4 Apollo Check Assaying
13.4.4.1 Metallic Check Assays
Apollo has completed metallic assays on 594 samples. Of these a total of 512 can be compared to fire
normal fire assays. The metallic assays are 17% higher in grade than the average of the fire assays from
these intervals. A total if 289 metallic assays are higher in grade to the average of the fire assays, while
223 are equal to or lower in grade. MDA believes that metallic assays are essential in obtaining a
sample assay that is representative of the gold in the core sampled. Other assay methods will find too
much gold on occasion, but the majority will find less than is in the core. Figure 13.6 shows the
comparison of the metallic assays to the fire assays.
Figure 13.6 Apollo Metallic Check Assays
200
180 y = 1.1709x - 0.0031

2
160 R = 0.8992
Screen Metallic - g Au/t
140
120
100
80
60
40
20
0
0 20 40 60 80 100 120 140 160 180 200
Original Assay - g Au/t
13.4.4.2 Standards and Blanks
Apollo submitted standards and blanks within each set of samples submitted for assay. Four labs were
used with most of the assays completed by Swastika. Figure 13.7 shows that the blanks usually agree
for the several thousand tests that were completed.

Figure 13.7 Apollo Blank Check Assays
1.6
1.4
1.2
1
g Au/t
0.8
0.6
0.4
0.2
0
0 500 1000 1500 2000 2500 3000 3500 4000 4500 5000
Number of Blank Checks
Accurassay ALS SGS Swastika
A number of sample standards have been run the groups of samples. Figures 13.8 and 13.9 show the
two most common high-grade and low-grade standards. Swastika has shown reasonable ability to
accurately assay the standards.

Figure 13.8 High-Grade Standard
12
10
8
g Au/t
0
0 200 400 600 800 1000 1200 1400 1600 1800
Number of Checks - 9.62 g Au/t Standard
Figure 13.9 Low-Grade Standard
12
10
8
g Au/t
0
0 500 1000 1500 2000 2500
Number of Checks - 1.422 g Au/t Standard

The following ranges were used to pass or fail the blanks and standards:
Blank > 0.03 g Au/t =Fail

Standard 1.422 >1.528 or <1.322=Fail
Standard 11.27 >12.03 or <10.63=Fail
Standard 9.62 >10.28 or <9.00 =Fail
If the blank or standard failed, than the entire batch (20 samples) would be reassayed, as well as the
failed standard or blank.
13.4.4.3 Check assays on sample pulps
A total of 8,425 sample pulps have been rerun by the original assayer. These samples indicate good
agreement between the original sample and the rerun sample as shown in Figure 13.10. The pulp check
needed to be within + 10%. If not the pulp would be reassayed a second time.
Figure 13.10 Sample Pulp Checks – First Rerun
500
450
400
350 y = 1.0023x + 0.0355

Rerun 1 - g Au/t
R2 = 0.9956
300
250
200
150
100
50
0
0 50 100 150 200 250 300 350 400 450 500

13.4.4.4 Checks on Sample Rejects
A total of 2,618 assay intervals have been checked by a different lab by preparing an additional sample
from the original sample rejects. The original sample is higher than the check by about 4%. This
comparison is shown graphically in Figure 13.11. Of the 2,618 checks a total of 905 or about 35% have
differences of greater than 30%. If the checks were not within 20%, a second pulp would be prepared
from the rejects. Figure 13.12 is a graph of the relative difference between the original and the checks.
These differences are very significant and point out the need for a more substantial sampling and
assaying program.
Figure 13.11 Original Assay vs Check Assay From Sample Rejects
100
90
80
Check Assay 1 - g Au/t
70
60
50
y = 0.9693x + 0.8531
40 R2 = 0.8571
30
20
10
0
0 10 20 30 40 50 60 70 80 90 100

Figure 13.12 Relative Difference - Original Assay vs Check Assay From Sample Rejects
210.00%
Relative Difference (Original Assay - Check Assay) g
180.00%
150.00%
120.00%
90.00%
60.00%
Au/t
30.00%
0.00%
-30.00%
-60.00%
-90.00%
-120.00%
1 1,000 2,051
Number of Samples
13.4.4.5 Mini Bulk Sample Checks
Large composites averaging about 14 kg in weight were made by combining drill hole core and/or
rejects. Typically 9 drill hole intervals were composited into one mini-bulk sample, however the range
was 4 to 17. A total of 47 composites were made from mostly ore-grade intervals. Twenty one of the
47 ore-grade composites contained intervals that were from outside of mineralized zones. All but 12 of
the 47 ore-grade composites contained high-grade. Since these tests use a much larger sample than the
assay pulp, one would expect in a coarse gold deposit that the results of the mini-bulk sample gravity
tests to be more reliable than the 30 g pulps used for fire assay. The results of the 47 ore-grade mini-
bulk gravity tests indicated a 9% lower grade in the mini-bulk samples compared to the individual
assays. This is the opposite of what we would expect, and it is likely due to more high-grade material
being in the mini-bulk samples than in the deposit as an average. Figure 13.13 shows the comparison of
the original drill hole assays to the mini-bulk sample average grade. The 6 waste mini-bulk samples
showed an improvement in grade of 1382.3% compared to the individual core assays. One of the waste
samples averaged 0.00 g Au/t from the drill hole intervals and 2.82 g Au/t from the mini-bulk
composites. The other five mini-bulk samples were not assayed prior to testing. One of these samples
averaged 1.38 g Au/t from the mini-bulk test.

Figure 13.13 Mini-Bulk Sample Gravity Test Results
100.00
90.00
Weighted Average Assay - g Au/t
80.00
70.00 y = 1.0438x
60.00 R2 = 0.8784
50.00
40.00
30.00
20.00
10.00
0.00
0.00 10.00 20.00 30.00 40.00 50.00 60.00 70.00 80.00 90.00
Calculated Head Grade (Mini Bulk Gravity) - g Au/t

14.0 DATA VERIFICATION
Although the historic check assaying is considered substandard, the data verification has been
supplemented with the production of about 210,800 ounces of gold from the deposit and metallurgical
testing of drill core.
Apollo’s program for data verification is a considerable improvement of the past checks, however, while
the number of checks have improved, the sampling problems have become more evident. The metallic
assays have shown a grade improvement of about 17% over the average of the fire assays for the same
intervals. Check assays from pulps have shown good agreement with the original assays, while new
pulps prepared from rejects have not shown good agreement with the original assays. MDA believes
that the samples from drilling contain less gold than is representative from the area drilled, and that the
fire assay samples contain less gold than is in the core sample.
MDA recommends that Apollo consider using metallic assays as the only appropriate method to sample
the core, and that additional mini-bulk gravity tests and full scale bulk samples be completed for the
main types of mineralization in the deposit.

15.0 ADJACENT PROPERTIES
The major east-west trending Destor-Porcupine Fault Zone extends across the property. The DPFZ is
host to numerous deposits to the east and west of the Black Fox property along the 200 km strike length
of this structure. Figure 4.2 illustrates the location of many of the major mines along this structure.
The Timmins Gold camp, which produced about 70 million ounces of gold (Holmer Gold website), is
located about 75 km to the west of the Black Fox deposit. In the city of Timmins, mining employs about
25% of the workforce (Mayor Jamie Lim). There are numerous deposits along the trend of the DPFZ
within a few kilometers of the Black Fox deposit. These include the Ross Mine, New Kelore, Hislop,
West Zone, and Stroud (Creek Zone and Main Zone).
Table 15.1 lists the reserves of several of the larger mines along the DPFZ, while Table 15.2 summarizes
the resources.
Table 15.1 Reported Reserves From Selected Mines Along the DPFZ.
Proven Probable Proven and Probable
Company Depos it Tonnes Grade Ounces Au Tonnes Grade Ounces Au Tonnes Grade Ounces Au
0 00's g Au/t 000 's 00 0's g Au/t 0 00's 0 00's g Au/t 00 0's
Placer Dome/Kin ros s Pocupine Joint Ven ture
Placer Dome/Kin ros s Pamou r 5,053.0 1.41 230.0 31,065.0 1.38 1,376.0 36,119.0 1.38 1,606.0
Placer Dome/Kin ros s Hoy le Pon d 328.0 12.99 137.0 560.0 12.44 224.0 888.0 12.64 361.0
Placer Dome/Kin ros s Dome 10,935.0 1.03 361.0 10,936.0 2.00 702.0 21,871.0 1.51 1,063.0
Placer Dome/Kin ros s Owl Creek
Placer Dome/Kin ros s Bell Creek
Placer Dome/Kin ros s Holling er
Placer Dome/Kin ros s M cInty re
Placer Dome/Kin ros s Hallner
Placer Dome/Kin ros s Pres ton
Placer Dome/Kin ros s Paymas ter
Placer Dome/Kin ros s Pocupine Joint Ven ture 16,316.0 1.39 728.0 42,561.0 1.68 2,302.0 58,878.0 1.60 3,030.0
Kin ros s A q uarius 15.9 2.33 1,189.0 15.9 2.33 1,189.0
Newmo nt Hollo way 3,373.0 5.91 641.0 3,373.0 5.91 641.0
Barrick Holt-M cDermott 768.4 5.66 154.0 768.4 5.66 154.0
Kirkland Lake M acas s a 391.9 12.75 176.7 333.8 15.24 179.6 725.8 15.27 356.3
Totals Totals of S elected Mines 16,7 07.9 1 .68 90 4.7 47,052.1 2 .95 4,4 65.6 63 ,761 .0 2.62 5,3 70.3
Note: Source - Comp any W eb s ites ; Pro ven and Probable to tals s hown in prob able column

Table 15.2 Reported Resources From Selected Mines Along the DPFZ
Measured Indicated Measured and Indicated
Company Deposit Tonnes Grade Ounces Au Tonnes Grade Ounces Au Tonnes Grade Ounces Au
Placer Dome/Kinross Pocupine Joint Venture
Placer Dome/Kinross Pamour 177.0 0.88 4.0 2,318.0 1.06 79.0 2,495.0 1.05 83.0
Placer Dome/Kinross Hoyle Pond 43.0 8.68 12.0 78.0 6.78 17.0 121.0 7.45 29.0
Placer Dome/Kinross Dome 9,235.0 1.72 510.0 9,235.0 1.72 510.0
Placer Dome/Kinross Owl Creek 979.0 2.67 84.0 1,107.0 2.28 81.0 2,086.0 2.46 165.0
Placer Dome/Kinross Bell Creek
Placer Dome/Kinross Hollinger
Placer Dome/Kinross McIntyre
Placer Dome/Kinross Hallner
Placer Dome/Kinross Preston
Placer Dome/Kinross Paymaster
Placer Dome/Kinross Pocupine Joint Venture 1,199.0 2.62 100.0 12,738.0 1.68 687.0 13,937.0 1.76 787.0
Kinross Aquarius
Homer Gold Timmins High-Grade 422.0 13.68 185.6 422.0 13.68 185.6
Newmont Holloway 1,162.1 5.91 220.8
Barrick Holt McDermott 684.9 7.90 192.0 684.9 7.90 192.0
Kirkland Lake Macassa 794.7 11.82 329.6 2,192.0 8.71 615.1 2,986.7 9.84 944.7
Totals Totals of Selected Mines 1,993.7 6.70 429.6 16,036.9 3.26 1,679.7 19,192.7 3.78 2,330.1
Note: Source - Company Websites; Measured and Indicated totals shown in indicated column

16.0 MINERAL PROCESSING AND METALLURGICAL TESTING
The material in this section was developed mainly by Peter Taggart and Associates in conjunction with
developing a metallurgical flowsheet and estimated capital and operating costs for a 1,500 tpd plant used
in the 2004 pre-feasibility study completed by MDA for the Black Fox Project. The Hislop-Beatty
Project, presently known as the Black Fox Project, is located close to Matheson and is approximately 67
kilometres east of Timmins, Ontario. The project was owned by Exall Resources Limited (Exall) when
the Owner examined the feasibility of treating mineralization from the deposit in the Saint Andrew
Goldfields Stack mill.
Canadian Mine Development, commissioned by Exall to prepare a Feasibility Study, retained Mr. Rick
Swider, Richard C. Swider Consulting Engineers Limited to direct metallurgical testwork performed by
Lakefield Research Limited (Lakefield). The test program, conducted in 1996, was designed to assess
the amenability of the Stack mill to treating the Hislop-Beatty mineralization. The comprehensive
program confirmed the suitability of the plant and custom milling operations commenced in 1997.
In 1999, Kinross Gold was holding the Macassa plant in Kirkland Lake, on a “care and maintenance”
basis. Exall elected to use this plant, upon the expiry of the three year custom milling agreement with
Saint Andrew Goldfields. Operations commenced at the Macassa plant in October 1999 and were
terminated in May 2001.
Exall commissioned Richard Swider to oversee additional bench scale and pilot plant test programs in
1999, to examine alternative process options that could enhance process efficiencies.
16.1 Summary
The Black Fox mineralization is hosted in two zones, the West Zone and the East Zone. The West Zone
material principally comprises green carbonate and contains gold in quartz ankerite-veinlets. Minimal
amounts of sulphide are present. The East Zone contains up to 5% sulphides, principally as pyrite.
While the East Zone mineralization is slightly more refractory than the West Zone material, both exhibit
free milling characteristics and yield gold recoveries in excess of 95%.
The mineralization contains finely disseminated visible gold and is amenable to gravity concentration.
The host rock contains no graphite or cyanide consuming minerals in quantities sufficient to adversely
affect gold recoveries or operating costs.
Mine production from the Black Fox gold project was shipped to the St. Andrew Goldfields (Stock) mill
and the Kinross Gold Macassa mill during the periods April 1997 – September 1999 and October 1999 –
May 2001 respectively.
The historical metallurgical performance achieved during the period 1997 to 2001 is summarized in
Table 16.1

Table 16.1 Historical Plant Performance

Year Tonnes Grade Ounces Au Gold Recovery
000's g Au/t 000's %
1997 194.5 6.79 39.9 96.38%
1998 308.7 6.67 64.3 96.90%
1999 258.7 5.82 48.3 97.76%
2000 255.2 5.82 46.4 97.04%
2001 81.7 4.81 11.9 98.19%
Totals 1,098.8 5.97 210.8 97.14%

Note: Grade reported is the recovered grade, i.e. the grade necessary to produce 210,800 ounces of gold.
Lakefield conducted comprehensive bench scale testwork in 1996, followed by a combination of pilot
plant studies and related benchscale tests in 1999. Metallurgical testwork performed by Lakefield in
1996 demonstrated the Black Fox mineralization to be free-milling and devoid of deleterious elements
that could adversely affect the environment or the process. Test results indicated the potential value in
deploying a gravity concentration circuit. The program determined the optimum grinds for the West and
East Zones to be K80 50μm and K80 30μm respectively. The leach kinetics were found to be most
favorable, with 30 hours of leach time being sufficient to achieve optimum results.
The main conclusions developed by the Lakefield work are outlined below:
The gold mineralization is readily amenable to cyanidation. When grinding in a sodium cyanide
solution, approximately 90% of the gold contained in the mill feed is dissolved by the time the
pulp has exited the cyclone overflow.
The degree of dissolution is dependent on the leach feed grind. Optimum size distribution for
west zone ore appears to be 50 μm while the East Zone mineralization requires grinding 30-40
μm.
The Bond Ball Mill work index of the ore varies within the range of 14-17 kWh/t.
Gold dissolution is relatively insensitive to variations in leach times over the ranges examined.
Black Fox mineralization contains no deleterious elements that could adversely affect operating
efficiencies or the environment.
To varying degrees, Black Fox mineralization is amenable to gravity concentration.
The ground mineralization exhibits favorable settling characteristics.
Exall entered into a three year toll milling agreement with Saint Andrew Goldfields to process Black
Fox mineralization in the Stock mill. The empirical results achieved in the plant confirmed the original
test data.

Upon the expiry of the toll milling arrangement with Saint Andrew Goldfields, Exall shipped the mine
production to the Macassa mill. Metallurgical results continued to confirm the amenability of the Black
Fox mineralization to conventional cyanidation followed by CIP technology. While the higher sulfide
material generated somewhat inferior results, and consumed more cyanide, the problems were mitigated
through effective blending of the mill feed. Annual gold recoveries exceeded 97% at the Macassa mill.
A program of laboratory and pilot plant metallurgical studies was implemented in 1999 by Lakefield, to
examine alternate process options by which overall project economics could be enhanced. Based on
examination of six composite samples of varying grades and sulfide content, the use of spiral
concentrators was deemed to offer a means by which up to 80% of the gold could be recovered in 15%
of the feed weight, given a primary grind of 150μm.
Cyanidation tests, performed on the spiral concentrate, ground to K80 40μm, and un-ground spiral tails,
at a nominal K80 150μm, achieved leach residues similar to those achieved in the Stock mill.
Based upon these, and associated test results, preliminary economic analyses were prepared to assess the
potential economic consequences of adopting such a circuit. The results of these analyses, conducted by
Richard Swider, indicated that the use of a gravity pre-concentration stage, in conjunction with a coarser
primary grind, would be worthy of consideration in any future Feasibility Study.
In summary, the Black Fox mineralization is free-milling and environmentally innocuous. Although
visible gold is present, relatively fine grinds are required in accordance with the current flowsheet, to
achieve optimum results. Upside potential might be realized through the adoption of a gravity circuit in
conjunction with a coarser grind. Other process alternatives should also be included in a series of trade-
off studies, prior to finalizing the basis for a Feasibility Study. In any event, confirmatory testwork
should be performed on samples of mineralization deemed representative of grades and species to be
mined in accordance with the new mine plan.
16.2 Initial Metallurgical Testwork (1996)
Lakefield Research conducted bench scale test work in 1996 to determine the suitability of the Stock
mill to treat mineralization from the Black Fox deposit. The program, designed and directed by Richard
Swider, examined recovery of gold by gravity and cyanidation methods. In addition, characterization of
selected samples was performed for environmental purposes.
The work was performed on 67 samples of mineralization, 26 from the East Zone and 39 from the West
Zone. The samples were composited into 6 sample blends, three for each of the two zones, as shown in
Table 16.2.

Table 16.2 Gold Head Analyses for the Composite Samples, (g Au/t )
Calculated 1 General Low Grade High Grade
West Zone
LR Wtd. Avg 2 9.47 7.71 2.76 25.4
LR with Metallics 3 8.56 8.37 2.56 22.8
LR Test Average 4 8.38 6.63 2.18 23.1
East Zone
LR Wtd. Avg 2 20.1 18.1 3.75 41.0
LR with Metallics 3 22.9 17.7 9.56 40.0
LR Test Average 4 19.1 17.6 5.99 35.9
1. Calculated from the weighted average heads from composites General, Low, High
2. The head grade calculated from the weighted average heads from all samples used for compositing.
3. The direct head for each composite using a +/- 100 mesh pulp metallics procedure.
4. The back calculated average gold head grade from the test program.
Given the presence of visible gold, albeit finally disseminated, reasonable agreement is achieved in most
cases. The East Zone Low Grade demonstrates poor reconciliation between the head values shown.
Detailed head analyses of the individual composites failed to identify any elements or compounds that
could be environmentally deleterious or that could seriously adversely affect the cyanidation process.
Sulfide sulfur in the East Zone High Grade was measured at 3.05%. The highest equivalent sulfide
content in the West Zone material was 0.48%.
The Bond Work Indices of the East Zone and West Zone General Composites were determined to be
16.6 and 14.9 kWh/t respectively.
Gravity concentration tests were performed on each composite sample, yielding the results summarized
in Table 16.3.
Table 16.3 Summary of Gravity Concentration Test Results

Composite Head Wt Recovery Con. Grade Gold
Au, g/t % Au, g/t Recovery
%
West Zone
General 6.63 0.064 5,195 49.9
Low Grade 2.18 0.045 1,531 31.8
High Grade 23.1 0.097 13,132 55.4
East Zone
General 17.6 0.063 9,580 34.4
Low Grade 5.99 0.069 872 10.1
High Grade 38.0 0.160 15,063 47.6

Lakefield noted that “no coarse (>48 mesh) gold” was observed in any of the gravity tests.
Nevertheless, the results suggest that all but the East Zone low-grade mineralization could be amenable
to gravity concentration, although free gold commonly observed in the core may be larger.
Cyanidation tests were performed on the gravity circuit tails for each composite to determine the impact
that grind and leach time respectively impart on gold dissolution. The results indicated that gold
extraction from East Zone mineralization was sensitive to fineness of grind; gold extractions improved
as the fineness of grind increased from K80 70μm through 50μm to 30μm. West Zone leach extractions
were relatively unaffected by particle size, over the range examined. In addition, the effects of variable
leach times within the range of 36 hours to 72 hours were examined. Gold extractions from both East
and West Zone mineralization were found to be insensitive to leach times, again over the range
examined.
A summary of the key cyanidation data is presented in Table 16.4, based on 48-hour leach times, a K80
50μm grind for West Zone material and K80 30μm grind for East Zone mineralization.
Table 16.4 Summary of Cyanidation Test Data

Composite Reagent Consumption, kg/t Residue Au
g/t Au Extraction
%
Lime NaCN1
West Zone
General 0.70 0.32 0.14 95.1
Low Grade 0.89 0.18 0.08 95.0
High Grade 0.86 0.33 0.12 98.9
East Zone
General 0.76 0.31 0.68 93.1
Low Grade 1.02 0.20 0.33 93.9
High Grade 0.85 0.52 1.38 92.7
Cyanide consumed during leach, not including initial cyanide to 0.5gpl.
The samples examined were very amenable to cyanidation when low dosages of reagents were applied.
Grab samples of leach solution taken after 12 hours of leach indicated rapid leach kinetics. Since it was
proposed to grind in cyanide solution, Lakefield projected that “a significant proportion of the gold is
likely to be recovered in the carbon column circuit”.
Gold adsorption test data indicated that no deleterious species were present. It was projected that gold
adsorption in a CIP circuit would be rapid and complete after 7.5 hours.
Settling tests were performed on East and West Zone General Composites, at a K80 30μm grind. A
favorable unit area rate was achieved, being less than 0.2 m2/tpd in all cases in which modest flocculant
additions were used.

In conclusion, the favorable Lakefield test results, together with the existing Stock mill circuit
configuration, supported the concept of milling Black Fox mineralization in the Saint Andrew
Goldfields’ plant.
16.3 Stock Mill Operations (1996-1999)
The Stock mill, designed by Leslie Engineering, was constructed in 1988 but was laid dormant in 1994.
The plant included the conventional unit processes of:
• Primary crushing
• Closed circuit, single staged fine crushing
• Two staged grinding
• Pre-leach thickener and carbon columns
• Leach and Carbon-in-Pulp (CIP) circuits
• Carbon stripping and electrowinning, and
• Cyanide destruction.
Saint Andrew Goldfields’ personnel managed and operated the plant, allowing access to Exall’s
technical representative. Exall paid a processing charge, based on the tonnage milled. In addition, a
bonus was paid to the owner, based on gold extractions achieved.
Black Fox mineralization in excess of 1.6 g Au/t was delivered to the Stock mill by 35 tonne capacity
highway trucks. A 610 mm x 914 mm jaw crusher was replaced with a 1,067 mm x 1,3716 mm unit in
1999. The primary crusher discharge was further crushed in a 1,300 mm short head cone crusher, in
closed circuit with a screen, prior to being conveyed to the fine ore bin.
Grinding was accomplished in a 2,896 mm x 3,658 mm, 450 kW primary ball mill and a 2,743 mm x
3,353 mm, 337 kW secondary ball mill, in closed circuit with cyclones. Both mills were rubber lined.
“Optimum” grinding rates were reported to approximate 43 tph, subject to the mineralization being
processed, with work indices varying within the range 14 – 16 kWh/t. Grinding was performed in
cyanide solution.
The cyclone overflow gravitated to an 18.3 m diameter thickener, the overflow from which was pumped
to 7 carbon columns. The thickener underflow was pumped to 4 leach tanks to provide a nominal 27
hours retention time. Leach tailings were pumped to 5 CIP tanks that provided 3 hours retention time.
Carbon from the columns and CIP circuits was stripped at 142oC. One tonne batches of carbon were
regenerated on-site in an electrically-heated rotary kiln, after washing with 3% nitric acid. Fine
“attritted” carbon was recovered and shipped to Noranda. The pregnant strip solution was fed to a 1.0
m3 electrolytic cell. The sludge produced was dried and charged into an induction furnace to produce
dore bars.
Exall’s technical representative was present for the monthly estimates of gold inventories and was able
to monitor normal operations for about 50% of the time. While operations were satisfactory at the Stock
mill, some issues were of concern to Exall. Thus, certain housekeeping issues could have contributed to
loss of gold. Further, the Black Fox mineralization was processed in batches, typically of 5,000 tonnes.

Thus, at a nominal 1,000 tpd milling rate, campaigns were generally of 5 days duration. Ores from other
sources were processed between the Black Fox campaigns, rendering precise metallurgical accounting
difficult. This problem was exacerbated by scaling in flowmeters, caused by the high lime additions
used in the plant. While the plant produced gold recoveries in the mid- to high nineties, Exall elected to
ship mineralization to Macassa upon the expiry of the three year custom milling agreement with Saint
Andrew Goldfields.
During the milling campaign at the Stock plant, a very short plant test was conducted to operate a Falcon
concentrator and gravity table. The initial results were not sufficiently encouraging to justify a
protracted test. Based on the results of bench scale and pilot plant test programs, this is somewhat
surprising. It is conceivable that insufficient time was available to properly set up the circuit. It is also
possible that the fineness of grind contributed to the poor results.
16.4 Macassa Mill Operations (1999-2001)
Operations at the Macassa plant commenced October 1999. A consulting metallurgist, representing
Exall’s interests, had free access to all operating information at Macassa and was, in effect, the Chief
Metallurgist for the operations. The plant was highly automated and well-equipped with security
cameras. This degree of operations control and the exclusive use of the plant for Black Fox production,
mitigated most of the concerns that were associated with Saint Andrew Goldfields mill.
The Macassa plant, designed by Wright Engineers, provided the same basic unit processes as those at
the Stock plant, although a two-stage fine crushing plant replaced the single stage fine crushing circuit at
the Stock mill. Also, the Macassa plant included a pre-thickener leach tank. Further, being designed to
treat 2,000 tpd, the plant was oversized for the nominal 1,000 tpd Black Fox mine production rate.
Accordingly, most of the leach tanks were not required for Exall’s purposes. In all respects, the plant
was able to satisfy the process requirements.
The crushing circuit comprised a jaw crusher, a standard cone secondary crusher and a tertiary short
head crusher, in closed circuit with a vibrating screen. The crushing plant operated 12 hours per day.
Grinding was accomplished in two 600 kW ball mills that operated a 24 hours per day, 5 days per week
schedule. The primary mill was steel-lined and charged with 100 mm grinding media. The secondary
rubber-lined mill was charged with 25 mm balls. The nominal 1,000 tpd (40 – 45 tph) milling rate
produced a cyclone overflow grind within the range 70% - 75% passing 53 microns.
The cyclone overflow was directed to a pre-leach tank ahead of the 19.8 m diameter thickener, the
former providing a residence time of 30 hours. Given the favorable leach kinetics, gold dissolution was
typically 90% complete by the time pulp entered the thickener.
As for the Stock circuit, the thickener overflow was treated in carbon columns while, for much of the
time, the thickener underflow passed through a single leach tank, thus providing 60 hours of leach time
in total. The leach tank was only used to satisfy certain logistical requirements, rather than to provide
necessary incremental leach time. A 6-stage CIP circuit was deployed, prior to treatment of the carbon
in a conventional Adsorption, Desorption Recovery (ADR) circuit.
Sub-standard metallurgical performance and increased cyanide consumption were observed when
treating “sulphidic” material from the So zone in August 2000. However, these problems were
overcome by blending mineralization prior to milling. Gold recoveries at the Macassa plant are shown
in Table 16.5, together with the measured head grade and calculated head grade.
Table 16.5 A Summary of Macassa Production Data

Month Throughput Feed Grade Au Recovery
g/t Au %
Measured * Calculated **
October 1999 15,628 7.02 6.03 95.06
November 20,562 9.86 7.66 98.14
December 19,217 8.44 5.11 97.43
January 2000 19,385 11.03 6.05 97.75
February 22,864 12.69 8.59 97.87
March 20,779 3.97 3.56 97.43
April 21,377 4.53 4.16 97.38
May 24,856 7.05 5.16 97.62
June 22,938 10.87 9.85 98.78
July 19,530 8.24 6.26 97.67
August 20,732 4.90 4.53 86.29
September 23,870 4.84 5.12 97.04
October 23,767 6.01 4.79 96.79
November 23,080 6.60 6.78 97.42
December 12,309 7.73 7.00 98.48
January 2001 20,342 6.51 3.85 97.82
February 17,801 7.67 5.88 98.55
March 21,679 4.41 4.55 98.05
April 17,719 4.73 4.09 97.81
May 4,159 3.56 4.23 97.84
* Assay of a composite mill feed sample taken by an automatic sample cutter from the mill feed conveyor discharge.
** Calculated head based on in-plant gold inventory, gold production and tailings losses.
Exall reported three plant feed gold contents; the Measured Head, the Calculated Head grade and the
Calculated Cyclone Overflow grade.
The Measured Head is the assay of a composite mill feed sample, taken by an automatic sample
cutter from the mill feed conveyor discharge.
The Calculated Head is based on the actual amount of refined gold produced, mill circuit gold
inventories, the gold contained in the CIP tail residue and solution and the gold associated with
the recovered fine carbon.
The Calculated Cyclone Overflow grade is the computed total assay of this flow, based on solid
and solution assays and the pulp density.

Monthly plant gold recoveries were based on the Calculated Head. A review of plant metallurgical
accounting procedures indicates the application of sound protocols. The use of the Calculated Head to
determine the overall gold recovery was appropriate, given the quality of the raw data used to calculate
this head grade. Further, the Calculated Head grade agreed, within reason, with the Calculated Cyclone
Overflow gold grade, reflecting the relative ease with which representative samples of the overflow
stream could be taken. However, agreements between the Calculated Head and Measured Head values
were frequently poor.
Table 16.6 below compares the Measured Head, Calculated Cyclone Overflow Head and Calculated
Head values for the period January through March 2001.
Table 16.6 Comparison of Head Values (g/t Au), January to March Inclusive 2001
Measured Cyclone Overflow Calculated
Average 6.28 4.86 5.08

Standard Deviation 5.05 2.01
The above data is based on 132 shift Measured Head assays and 73 daily Cyclone Overflow calculated
values, all reported over the same 3 month period. The Measured Head value is most frequently higher
than the other two computed values. Further, the variability of the Measured Head assays is
considerably greater than experienced with Cyclone Overflow data. The predominant reason for the
higher and more variable Measured Head values is probably related to the difficulty in sampling
relatively coarse material in the presence of visible gold.
16.5 Metallurgical Testwork (1999)
Exall commissioned Lakefield to conduct a program of bench scale and pilot plant tests to investigate
the potential for gravity pre-concentration, using spirals and vat leaching as means by which toll milling
costs could be reduced. The program was conducted under the direction of Richard Swider. The
program was expanded to examine other concepts that offered the potential to enhance process
economics.
Samples of high and low-grade mineralization were combined to produce six composites, ranging in
grade from 2.07 g Au/t to 14.0 g Au/t. Descriptions of the samples are provided in Table 16.7.

Table 16.7 1999 Test Program Sample Description

Composite Constituents Grade, g/t Au
General Composite #1 (GC1) 60% low grade at 5.48 g/t 10.2

30% high grade at 14.0 g/t
10% very low grade at 1.84 g/t
General Composite #2 (GC2) 50% GC1 at 10.2 g/t 7.67
50% low grade at 5.48 g/t
Low Grade Composite (LG) 100% low grade at 5.48 g/t 5.48
Very Low Grade Composite 75% very low grade at 1.84 g/t 2.07
(VLG+A) 25% drum A
High Grade Composite (HG) 100% high grade at 14.0g/t 14.0
High Sulfide Composite 50% high sulfide at 8.45 g/t 11.2
(HS+HG) 50% high grade at 14.0 g/t
The programs involved extensive laboratory and pilot plant work that included gravity concentration,
leaching gravity concentrates and tailings, the flotation of gravity circuit tailings, thickening tests and
work index determinations. Details of the test programs, and the potential financial implications of the
results, are included in the reports issued by Lakefield and Richard Swider.
The conclusions drawn from the 1999 test programs are summarized in point form below.
The optimum grind for spiral performance was reported to be 166μm;

At a feed grind of 150 μm, the spirals produced a gravity concentrate which, at a 15% weight
recovery, contained approximately 80% of the gold in the feed;
Leach residues approximating those at the Stock mill (0.14 g/t Au) were achieved when the 150
μm spiral tailings were subjected to conventional cyanidation;
Spiral concentrates, reground to 40μm, were leached to produce leach residues of grades (0.13g/t
Au) similar to those at the Stock mill;
The High Sulfide Composite proved to be more refractory, reflecting experience in the operating
plant. Thus, the 40μm leach residue graded 1.8 g Au/t, while the overall leach residue (spiral
concentrate and tailings) was in the range of 0.40 g Au/t, equivalent to a 97% gold recovery.
Knelson concentrators, used to treat spiral tailings, failed to yield any significant benefit;
Bond Ball Mill work index determinations indicated a value of 17 kWh/t should be used for plant
design purposes;
Flotation was found to be effective in the treatment of sulfide mineralization, but of marginal
value when processing low sulfide material; and
Thickener unit area determinations for the leached spiral tailings (158μm) and the leached spiral
concentrate (40μm) were 0.274 and 0.173 m2/t/day respectively, at pH values just in excess of
10.0.
The test programs generated a significant amount of useful information that could be used in process
trade-off studies during the preparation of a Feasibility Study. It will be important to ensure that the
samples tested in this particular program are representative of the mineralization to be processed in

accordance with updated mining plans. Additional confirmatory work might be required for feasibility
level work.
16.6 2006 Mini Bulk Sample Gravity Tests
Francis Pitard (2005) recommended 200 mini-gravity tests be completed and compared back to the
original sample grades. Apollo started this program with a total of 58 tests completed, averaging about
14 kg per test. Of these tests, 47 were completed on “ore grade” material, 6 on “waste”, and 5 were
completed on samples that had not been assayed.
The 47 tests completed on “ore-grade” materials indicated an average gravity recovery of about 59%.
The average feed size for these tests was K80 114 μm. These tests are summarized in more detail in
Section 13.
16.7 Implications of Test Data and Empirical Results on Conceptual Plant Design
The rapid leach kinetics consistently experienced in the laboratory and plant should be exploited to the
full. By so doing:
Gold is extracted at the earliest opportunity
The production and handling of high-grade gravity concentrate products is avoided, and,
Leach circuit retention times can be reduced.
Pending further benchscale testwork, a variant of the concept developed in 1999 has been adopted and
constitutes Owner Mill Case 1 in this Preliminary Feasibility Study. Thus, the primary grind will be
80% 150 µm and a gravity concentrate will be produced from the cyclone overflow product. The
concentrate will be reground to 80% 40 µm, prior to leaching is adopted. However, in this case, the
reground concentrate will be combined with the gravity tailing to feed the pre-leach thickener. By using
this circuit, and grinding in cyanide, the recovery of gold to the gravity concentrate will be reduced
significantly. Nevertheless, such a circuit will enhance the rate at which minor amounts of the more
refractory mineralization will be leached. Further, since testwork has demonstrated gravity recoveries
improve with increasing feed grades, the proposed circuit will alleviate any potential difficulties that
may result from short-term feed grade “spikes”. Further gravity and leach work, in conjunction with
mineralogical and modal analysis, is required to examine the circuit, at a bench scale level, prior to the
preparation of a detailed feasibility study.
Historically, leach times of 30 hours have been adopted. Given the operating and test results reported
above, a leach time of 18 hours should provide adequate time to achieve the optimum economic leach.
This supposition must be confirmed in trade-off studies based on the laboratory work noted above.

16.8 Gold Recovery Projections
Gold recoveries are plotted against feed grades in Figure 16.1 for the period January 2000 through to the
termination of operations in May 2001. With the exception of August 2000, all gold recoveries exceeded
96%, indicating a modest improvement in gold recovery as feed grades increased from a nominal 2.5 g
Au/t Au to 10.0 g Au/t.
Figure 16.1 Gold Recoveries vs. Feed Grades
G o ld Re c o v e r y v s F e e d G r a d e b y L o t
(Y e a r s 2 0 0 0 a n d 2 0 0 1 )
100.0
98.0
96.0
Gold R ecovery, %
94.0
92.0
90.0
88.0
86.0
84.0
0.0 2.0 4.0 6.0 8.0 10.0 12.0
C a lc u la te d G o ld F e e d G ra d e , g /t Au
The precise reason(s) for the poor gold recovery in August 2000 were never clearly identified. It was
strongly suspected, however, that the milling of S1 mineralization, reportedly higher in sulphides
content, could have contributed to the problem. Exall determined that swings in gold recovery could be
largely mitigated by blending ores prior to treatment.
An overall gold recovery of 97% is proposed for this pre-feasibility study, based on
the assumptions that:
Ores to be treated will exhibit similar metallurgical characteristics to those processed in 2000 and
2001;
The feed grade will not fall beneath 4.0 g Au/t, and
Ores of differing grades and mineralogical composition will be blended, at least to the same
degree as that achieved during the Macassa operations.

17.0 MINERAL RESOURCE ESTIMATE
Mineral resource estimation reported for the Black Fox property follows the guidelines of Canadian
National Instrument 43-101 and the CIM August 2000 definitions, updated November 2003 with best
practice guidelines. The modeling and estimate of gold resources was done by MDA as of December
31, 2005. The resources for the Black Fox deposit are based on all drilling through the end of 2005 and
were calculated by Mine Development Associates (MDA). Apollo completed a total of 449 surface
diamond drill holes totaling 136,391.6 m and 321 underground diamond drill holes totaling 75,704.5 m
since purchasing the property. The Apollo drilling supplements the 245 surface drill holes and 721
underground drill holes drilled by prior owners.
17.1 Definitions
The resources stated in this report for the Black Fox project conform to the best practices guidelines
adapted in November 2003 and the definitions adopted by the Canadian Institute of Mining, Metallurgy
and Petroleum (CIM), August 20, 2000, and meet the criteria of those definitions, where:
A Mineral Resource is a concentration or occurrence of natural, solid, inorganic or fossilized

organic material in or on the Earth’s crust in such form and quantity and of such a grade or
quality that it has reasonable prospects for economic extraction. The location, quantity, grade,
geological characteristics and continuity of a Mineral Resource are known, estimated or
interpreted from specific geological evidence and knowledge.
A ‘Measured Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or
quality, densities, shape, physical characteristics are so well established that they can be
estimated with confidence sufficient to allow the appropriate application of technical and
economic parameters, to support production planning and evaluation of the economic viability
of the deposit. The estimate is based on detailed and reliable exploration, sampling and testing
information gathered through appropriate techniques from locations such as outcrops, trenches,
pits, workings and drill holes that are spaced closely enough to confirm both geological and
grade continuity.
An ‘Indicated Mineral Resource’ is that part of a Mineral Resource for which quantity, grade or
quality, densities, shape, physical characteristics can be estimated with a level of confidence
sufficient to allow the appropriate application of technical and economic parameters, to support
mine planning and evaluation of the economic viability of the deposit. The estimate is based on
detailed and reliable exploration and testing information gathered through appropriate
techniques from locations such as outcrops, trenches, pits, workings and drill holes that are
spaced closely enough for geological and grade continuity to be reasonably assumed.
An ‘Inferred Mineral Resource’ is that part of a Mineral Resource for which quantity and grade
or quality can be estimated on the basis of geological evidence and limited sampling and
reasonably assumed, but not verified, geological and grade continuity. The estimate is based on
limited information and sampling gathered through appropriate techniques for locations such as
outcrops, trenches, pits, workings and drill holes.
17.2 Data
MDA created a database containing drill hole information from the 1,736 surface and underground drill
holes. The information in the database included surface coordinates (local grid), down-hole survey data,
detailed geologic information, geotechnical data, and assay data. Nearly all of the surface drill holes
have been drilled on fence lines that have a N36oW orientation, intended to be drilled perpendicular to
the strike of the deposit. The fence lines have generally been on 12.5 to 25 m intervals. The early
underground drilling is much less regular, generally radiating from available underground drill stations.
Apollo’s underground drilling has been drilled on regular fence lines, generally from a new drift
completed about 235 ft below the surface. The mine grid is rotated 36o to the north to allow plotting of
east-west sections across the deposit. Plotting the mineralized zones on plan view indicates that the
mineralization actually follows closer to a N70oE trend, however the underground workings sometimes
cross this trend, indicating that some of the mineralization may be from crossing structures. Data from
chip or muck samples were not used in building the grade model.
17.3 Density
A total of 1,218 density tests have been completed by Apollo from core intervals. The average density
of mineralized material is 2.78, while the average density of unmineralized material is 2.85, as shown in
Table 17.1 and graphically in Figures 17.1 for mineralized material and Figure 17.2 for non-mineralized
material.
Table 17.1 Black Fox Densities
Material Number S.G.

Type Tests
Mineralized 274 2.78
Not Mineralized 944 2.85

Figure 17.1 Apollo Density Testing – Mineralized Material
3.5
2.5
Specific Gravity
1.5
0.5
0
0 50 100 150 200 250 300
Number of Tests
Figure 17.2 Apollo Density Testing – Non-mineralized Material
3.50
3.00
2.50
Specific Gravity
2.00
1.50
1.00
0.50
0.00
0 100 200 300 400 500 600 700 800 900 1000
Number of Tests

A density of 2.78 t/m3 was used to estimate mineralized material, 2.85 t/m3 to estimate waste rock
material, and 2.00 t/m3 to estimate overburden. There are no density tests for overburden materials.
Testing is suggested for this material prior to a feasibility study.
17.4 Black Fox Geologic Model
Cross sections were created on 12.5 m intervals for the deposit showing the drill hole assay information,
rock types, and mine workings based on the local coordinate grid. Mineralized zones were drawn on the
sections using a grade of 0.20 g Au/t to define the outline of the zones. Since the deposit has been
drilled on 12.5 to 25 m fence lines, the sections on the 12.5 m interval sometimes lacked the data to
draw mineralized outlines. In most instances the mineralized zones appear to exhibit continuity on the
section and from section to section. In many cases several of the zones appear to merge with each other.
The mineralized zones from the cross sections were transferred to plan view on 3 m intervals.
The plan view mineralized zones were developed from the location of the 1.5 m drill hole composites on
plan, the mine workings and the location of the cross sectional trace of the zones. The 3 m plans were
developed from the surface to about 700 m below the surface. An artificial elevation has been given to
the surface of 10,000, which is actually a little above 200 m above sea level. The underground drilling
by Exall complicated the drawing of zones. Sometimes there would be several holes converging in one
area of the plans, which could not always be honored, since some of the intervals were mineralized and
some not mineralized in the same general location. On some sections, the mineralized zone was
projected through barren material if the rock type of the barren material was noted as a quartz vein, and
the drill holes immediately up-dip and down-dip of the barren intersection found mineralization above
0.2 g Au/t.
The mineralization found inside the main ankerite alteration has been grouped into five mineralized
zones. These zones were numbered from footwall to hanging wall of the alteration zone: 7; 11; 4; 13; 9.
Since the zones merge, it was difficult to be consistent in numbering the zones. There are no known
geological or geochemical features that can differentiate one zone from another, other than the
mineralized footwall zone. Even then, using the footwall zone as a starting point to number the zones
also can create difficulties in properly numbering and connecting the mineralized zones as the footwall
zone is occasionally absent or may contain multiple zones of mineralization. Two wide areas of
mineralization have been defined within the hanging wall of the deposit. With many zones that appear
to merge, widen, and disappear, the odds of properly connecting and numbering the zones is low.
A statistical study was completed for assays and composites within each of the mineralized zones.
Grade distribution (qq) plots of each mineralized zone were used to determine grade domains for the
data contained in each zone. Each of the mineralized zones contained several grade domains as shown
in Table 17.2. Table 1.3 also shows that if the entire data set was used, the capping and domain ranges
would be higher than each of the individual zones. The result of using the high grade caps shown in
Table 17.2 is a loss of 26.4% of the contained metal, based on difference between the capped and
uncapped average grades.

Table 17.2 Mineralized Zone Domains and High Grade Cut
Zone Domain Domain Min Domain Max Domain Cap Domain Median "Metal Lost" in Zone
g Au/t g Au/t g Au/t g Au/t by cut (%)
2 High Grade 4.5 40.00 40.00 45.33%
2 Pull 1 0.8 4.50 1.53
2 Pull 2 0 0.80 0.2
4 High Grade 7.5 175.00 175.00 25.02%
4 Pull 1 0.7 7.50 1.6
4 Pull 2 0 0.70 0.17
5 High Grade 2 6.50 6.50 32.30%
5 Pull 1 0.7 2.00 1.15
5 Pull 2 0 0.70 0.19
7 High Grade 6 80.00 80.00 17.16%
7 Pull 1 1.3 6.00 2.53
7 Pull 2 0 1.30 0.23
9 High Grade 15 120.00 120.00 17.07%
9 Pull 1 1.3 15.00 2.92
9 Pull 2 0 1.30 0.22
11 High Grade 11 65.00 65.00 27.73%
11 Pull 1 0.7 11.00 2.16
11 Pull 2 0 0.70 0.17
13 High Grade 6 90.00 90.00 30.63%
13 Pull 1 0.5 6.00 1.23
13 Pull 2 0 0.50 0.13
All Zones Total "Metal Lost" by Cut 26.42%
All Zones High Grade 20 220.00 220.00 20.46%
The composite statistics are shown in Table 17.3 for all down-hole composites, the composites within
the zone and the cut composites within the zone.

Table 17.3 Composite Statistics by Zone
Zone Group Valid N Mean Median Minimum Maximum Variance Std.Dev. C.V.
2 capped 4,299 1.61 0.40 0.00 40.00 17.76 4.21 2.61
4 capped 5,151 3.27 0.51 0.00 175.00 108.21 10.40 3.18
5 capped 687 0.92 0.61 0.00 6.50 1.01 1.00 1.09
7 capped 2,123 2.34 0.51 0.00 53.62 35.22 5.93 2.54
9 capped 9,864 2.55 0.47 0.00 118.12 62.93 7.93 3.11
11 capped 5,393 3.57 0.77 0.00 65.00 53.35 7.30 2.04
13 capped 5,928 2.33 0.51 0.00 72.23 39.41 6.28 2.70
2 pull 1 4,299 0.75 0.40 0.00 4.48 0.71 0.84 1.12
4 pull 1 5,151 1.08 0.51 0.00 7.49 1.86 1.37 1.26
5 pull 1 687 0.68 0.61 0.00 2.00 0.24 0.49 0.72
7 pull 1 2,123 1.04 0.51 0.00 5.98 1.29 1.14 1.09
9 pull 1 9,864 1.35 0.47 0.00 14.95 5.02 2.24 1.65
11 pull 1 5,393 1.69 0.77 0.00 10.96 4.56 2.14 1.26
13 pull 1 5,928 0.96 0.51 0.00 6.00 1.25 1.12 1.16
2 pull 2 4,299 0.27 0.20 0.00 0.80 0.03 0.17 0.63
4 pull 2 5,151 0.23 0.17 0.00 0.70 0.02 0.14 0.62
5 pull 2 687 0.24 0.19 0.00 0.69 0.02 0.15 0.61
7 pull 2 2,123 0.35 0.23 0.00 1.30 0.07 0.27 0.76
9 pull 2 9,864 0.35 0.22 0.00 1.30 0.08 0.28 0.79
11 pull 2 5,393 0.22 0.17 0.00 0.70 0.02 0.13 0.59
13 pull 2 5,928 0.19 0.15 0.00 0.50 0.01 0.10 0.51
0* all 73,862 0.05 0.02 0.00 53.40 0.07 0.27 5.71
* Zone 0 is all the composites outside the mineralized zones
Figure 17.3 shows variograms generated using all composites from zones 4, 7, 9, 11, and 13 collectively,
as these domains form the main portion of the Destor-Porcupine Fault Zone; meaningful variograms
could not be generated from every one of the domains examined individually. The variograms shown
indicate maximum ranges of 55 m in the dip direction, 35 m along strike, and 17 m in the direction
perpendicular to strike and dip, although most of the spatial relationship between the samples occurs at
significantly shorter ranges. MDA used the results of this variographic study to aid in the determination
of the search ranges used in grade interpolation.

Figure 17.3 Black Fox Variograms: All Composites From Domains 4, 7, 9, 11, and 13
Omni-directional Strike (075º)
Dip (-50º, 165º) Across (40º, 165º)
A block model of the deposit was created using 3 m (along strike), by 2 m (across strike) by 3 m (level
interval) blocks. Three dimensional solids were used to determine if a block was inside a mineralized
zone based on block centroid. The deposit is generally covered by 10 to 40 m of glacial till. The top of
rock contact was developed from contouring the top of rock from the surface drill hole intercepts.
Blocks were coded alluvium, workings, and originally had a default of a waste code. Drill hole assays
were composited into one and one half meter composites to estimate the gold grades in the model. The
composites were entirely contained in the mineralized zone.
The grade model evolved through a number of iterations. Initially a model was developed for 1 m x 1 m
x 1.5 m blocks. Grades were interpolated by inverse distance raised to the third power, using a number
of passes to estimate block grades. Each mineralized zone was interpolated independently. Since the

zones often merged, the composites for the adjoining zones were also used to interpolate grades of the
zone being interpolated. For example, the interpolation of block grades into zone 7, the footwall zone,
used composites from zones 7, and also zone 11, the next higher zone. The interpolation of zone 11,
used the composites from zone 11 as well as the ones from zones 7 and 4, and so on.
The interpolation passes were as follows:
Pass 1. This pass used all of the capped composites for the zone being interpolated as well as the
adjoining capped composites. Since the variograms indicated longer ranges down dip compared
to along strike or across strike this relationship was used to interpolate the block grades. This
estimate block grades. A minimum of one composite and a maximum of 8 composites were used
Pass 2. This pass is also known as the “pull1” pass. The composites in the high-grade domain
shown in Table 1.3 were pulled from the composite data set and replaced with the median grade
of the “pull1” domain. This pass estimated grades into only un-estimated blocks in the model.
This pass used an ellipsoid search of 15 m along strike, 27 m down dip, and 8 m across strike to
estimate block grades. A minimum of one composite and a maximum of 12 composites were
used to estimate block grades. A maximum of 3 composites from a single drill hole was applied.
Pass 3. This pass is known as the “pull2” pass. The composites in the “pull1” domain shown in
Table 1.3 were pulled from the composite data set and replaced with the median grade of the
“pull2” domain. This pass estimated grades into only un-estimated blocks in the model. This
estimate block grades. A minimum of 4 composites and a maximum of 12 composites were used
Pass 4. This pass was to add back some of the material lost by cutting. Some very high-grade
material does occur in the deposit. The fourth pass used a 2 x 3 x 3 search with the uncapped
data, to fill only the closest block to the composite. This pass increased the Pass 3 estimated
contained ounces by about 2.5% at a 1 g Au/t cutoff.
Pass 5. In reviewing the results of the modeling, it was noted that where the drill hole spacing
was 20-25 m low grade would be estimated between two or more high-grade intercepts. The
reason for this is limitation on the pass one interpolation, and the replacement of high-grade
values with the Pass1 domain median grade. MDA added Pass 5 to increase the search distances
in high-grade areas using the capped composites, rather than replacing with the median value of
the pull1 domain. To define the high-grade areas an indicator was interpolated using the Pass 2
search distances. If the composite value was in the high-grade domain it was given a value of
one, while all other composites were given an indicator of zero. Indicator block grades were
interpolated by inverse distance raised to the third power into all blocks defined by in Pass 2. If
the block grade of the indicator was above 0.4, then new values were interpolated in Pass 5 using
the Pass 2 search distances, but with capped composites rather than the pull1 composites.

Table 17.4 shows the basic statistics of the model. Figure 17.4 illustrates the distribution of the model
compared to assays and capped composites.
Table 17.4 Grade Model Statistics
Zone # Blocks Mean Median Minimum Maximum Variance Std.Dev. C.V. Pass
All 335,680 2.07 0.75 0.00 114.80 22.89 4.78 2.31 3
2 44,964 1.08 N/A 0.00 39.45 5.41 2.33 2.15 3
4 51,891 2.54 N/A 0.00 110.84 42.68 6.53 2.57 3
7 28,626 1.76 N/A 0.00 50.65 12.65 3.56 2.02 3
9 73,029 2.18 N/A 0.00 114.80 29.51 5.43 2.49 3
11 64,935 2.81 N/A 0.01 53.62 21.92 4.68 1.67 3
13 56,843 1.94 N/A 0.00 105.78 20.40 4.52 2.32 3
All 335,680 2.12 0.75 0.00 1195.78 47.76 6.91 3.26 4
2 44,964 1.15 N/A 0.00 782.69 31.37 5.60 4.87 4
4 51,891 2.61 N/A 0.00 990.07 96.85 9.84 3.77 4
7 28,626 1.77 N/A 0.00 112.19 13.57 3.68 2.08 4
9 73,029 2.23 N/A 0.00 1195.78 61.74 7.86 3.53 4
11 64,935 2.87 N/A 0.01 881.78 49.64 7.05 2.45 4
13 56,843 1.95 N/A 0.00 369.34 23.62 4.86 2.49 4
All 335,680 2.20 0.75 0.00 1195.78 49.43 7.03 0.01 5
2 44,964 1.15 N/A 0.00 782.69 31.39 5.60 4.85 5
4 51,891 2.77 N/A 0.00 990.07 101.03 10.05 3.62 5
7 28,626 1.89 N/A 0.00 112.19 15.53 3.94 2.09 5
9 73,029 2.24 N/A 0.00 1195.78 62.17 7.88 3.51 5
11 64,935 3.02 N/A 0.01 881.78 51.77 7.20 2.39 5
13 56,843 2.04 N/A 0.00 369.34 25.34 5.03 2.46 5

Figure 17.4 Grade Model Distribution
Quantile-Quantile Plot of g Au/t - Drill Holes; Composites; Model

Distribution: Normal
0.01 0.05 0.25 0.50 0.75 0.90 0.99
9000.000
6000.000
3000.000
900.000
600.000
300.000
90.000
60.000
30.000
Observed Value
9.000
6.000
3.000
0.900
0.600
0.300
0.090
0.060
0.030 Capped Composites
Model - Pass 5
0.009 Apollo Surface
0.006 Apollo Underground
0.003 Exall Surface
Exall Underground
0.001
0.001 Noranda Surface
Since MDA believes that the drill hole samples do not represent the material present, i.e. biased toward
low grade, no measured material has been defined. Blocks with that are within 6 m of the closest hole or
within 12 m and are estimated with at least three composites are classed as indicated (1). This material
would have normally been classed as measured without the sampling issues. Other blocks that were
estimated with Passes 1-5 are classed as indicated (2). The indicated material contained in the grade
model at different cutoff grades is shown in Table 17.5.

Table 17.5 Indicated Material Contained in the Mineralized Zones at Different Cutoff Grades
Indicated 1 Indicated: 2 Total Indicated
Cutoff tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au % of Total tonnes g Au/tonne oz Au
g Au/t 000's 000's 000's 000's 000's 000's
0.00 3,039.5 2.89 282.0 14,048.1 2.03 916.0 100.00% 17,087.6 2.18 1,198.0
0.25 2,646.1 3.29 279.9 11,747.9 2.39 903.4 84.24% 14,394.0 2.56 1,183.3
0.50 2,057.6 4.13 273.0 8,796.1 3.07 869.0 63.52% 10,853.8 3.27 1,142.0
0.75 1,680.2 4.92 265.5 6,954.4 3.72 832.6 50.53% 8,634.6 3.96 1,098.1
0.80 1,626.1 5.05 264.2 6,672.3 3.85 825.6 48.56% 8,298.4 4.08 1,089.7
0.85 1,574.2 5.19 262.8 6,413.7 3.97 818.7 46.75% 7,987.9 4.21 1,081.5
0.90 1,527.1 5.33 261.5 6,178.5 4.09 812.1 45.09% 7,705.6 4.33 1,073.6
0.95 1,480.3 5.46 260.1 5,929.3 4.22 804.7 43.36% 7,409.6 4.47 1,064.8
1.00 1,434.1 5.61 258.6 5,713.3 4.34 798.0 41.83% 7,147.5 4.60 1,056.6
1.05 1,392.1 5.75 257.2 5,489.3 4.48 790.6 40.27% 6,881.4 4.74 1,047.8
1.10 1,353.2 5.88 255.9 5,288.9 4.61 783.7 38.87% 6,642.1 4.87 1,039.5
1.15 1,314.1 6.02 254.5 5,099.6 4.74 776.8 37.53% 6,413.6 5.00 1,031.3
1.20 1,280.6 6.15 253.2 4,917.6 4.87 770.0 36.27% 6,198.2 5.13 1,023.2
1.25 1,247.1 6.28 251.9 4,736.0 5.01 762.8 35.01% 5,983.1 5.27 1,014.7
1.50 1,107.1 6.90 245.7 4,031.4 5.65 731.8 30.07% 5,138.6 5.92 977.5
1.75 989.3 7.53 239.6 3,486.4 6.28 703.5 26.19% 4,475.7 6.55 943.1
2.00 894.6 8.13 233.9 3,080.2 6.86 679.1 23.26% 3,974.8 7.14 913.0
2.25 816.4 8.71 228.6 2,742.2 7.44 656.0 20.83% 3,558.5 7.73 884.5
2.50 749.3 9.28 223.5 2,461.3 8.02 634.6 18.79% 3,210.7 8.31 858.0
2.75 695.6 9.79 218.9 2,220.2 8.61 614.2 17.06% 2,915.8 8.89 833.2
3.00 645.3 10.33 214.3 2,031.9 9.14 596.9 15.67% 2,677.2 9.42 811.2
4.00 502.8 12.28 198.5 1,508.5 11.11 538.9 11.77% 2,011.3 11.40 737.4
5.00 413.0 13.98 185.6 1,194.8 12.86 493.9 9.41% 1,607.8 13.14 679.5
6.00 345.3 15.64 173.6 984.4 14.44 456.9 7.78% 1,329.7 14.75 630.5
7.00 289.7 17.40 162.1 823.6 15.99 423.4 6.52% 1,113.3 16.36 585.4
8.00 246.3 19.14 151.6 705.1 17.42 394.9 5.57% 951.4 17.87 546.5
9.00 215.5 20.67 143.2 612.1 18.78 369.6 4.84% 827.7 19.27 512.8
10.00 188.2 22.29 134.9 530.7 20.21 344.8 4.21% 718.9 20.75 479.6
11.00 163.8 24.05 126.7 466.7 21.54 323.2 3.69% 630.6 22.19 449.9
12.00 145.1 25.67 119.7 411.1 22.90 302.6 3.25% 556.2 23.62 422.4
13.00 129.5 27.25 113.5 368.8 24.09 285.7 2.92% 498.3 24.91 399.2
14.00 114.1 29.11 106.8 330.9 25.31 269.2 2.60% 445.0 26.29 376.0
Several models were completed using different Pass 1 search distances to test the model sensitivity. The
model sensitivity to different Pass 1 search distances is shown in Table 17.6.

Table 17.6 Indicated Material Contained Model Using Different Pass 1 Search Distances
Indicated 1 Indicated 2 Total Indicated Change From 15 x 9 x 4 Model
Cutoff Model tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au
g Au/t Pass 1 Search 000's 000's 000's 000's 000's 000's 000's 000's
0.00 12 x 6 x 4 2,226.3 2.97 212.9 14,861.3 1.84 877.2 17,087.6 1.98 1,090.1 0.0 (0.20) (107.9)
0.00 15 x 9 x 4 3,039.5 2.89 282.0 14,048.1 2.03 916.0 17,087.6 2.18 1,198.0
0.00 18 x 12 x 4 3,771.9 2.92 354.2 13,315.6 2.13 913.6 17,087.6 2.31 1,267.8 0.0 0.13 69.8
0.00 21 x 15 x 4 4,275.3 2.93 403.0 12,812.3 2.20 904.6 17,087.6 2.38 1,307.6 0.0 0.20 109.6
0.00 15 x 9 x 6 3,592.8 2.83 327.4 13,494.8 2.04 886.9 17,087.6 2.21 1,214.2 0.0 0.03 16.2
0.90 12 x 6 x 4 1,081.0 5.69 197.8 6,615.6 3.60 764.8 7,696.6 3.89 962.6 (9.0) (0.44) (110.9)
0.90 15 x 9 x 4 1,527.1 5.33 261.5 6,178.5 4.09 812.1 7,705.6 4.33 1,073.6
0.90 18 x 12 x 4 1,950.9 5.24 328.9 5,905.1 4.30 816.9 7,856.0 4.54 1,145.9 150.4 0.20 72.3
0.90 21 x 15 x 4 2,248.0 5.18 374.4 5,883.9 4.30 812.9 8,131.9 4.54 1,187.3 426.3 0.21 113.7
0.90 15 x 9 x 6 1,801.9 5.23 302.8 5,959.8 4.11 787.5 7,761.7 4.37 1,090.3 56.1 0.04 16.7
3.00 12 x 6 x 4 466.1 11.01 164.9 1,821.5 8.84 517.8 2,287.6 9.28 682.7 (389.6) (0.14) (128.5)
3.00 15 x 9 x 4 645.3 10.33 214.3 2,031.9 9.14 596.9 2,677.2 9.42 811.2
3.00 18 x 12 x 4 830.9 10.07 268.9 2,149.5 8.98 620.7 2,980.4 9.28 889.6 303.2 (0.14) 78.5
3.00 21 x 15 x 4 950.7 9.98 304.9 2,235.8 8.64 621.2 3,186.5 9.04 926.1 509.3 (0.38) 115.0
3.00 15 x 9 x 6 755.0 10.17 246.7 2,001.0 9.05 581.9 2,756.0 9.35 828.6 78.8 (0.07) 17.4
The comparison shown in Table 17.6 shows the change in contained ounces at low cutoff grades (i.e.
open pit) for the different search distances shows a range of + 10% for the distances tested. As the
cutoff grade increases (i.e. underground) the sensitivity for the different search distances increases to +
16%.
The 700 m vertical dimension of the model was divided into potential open pit and underground areas to
compute resources. The top 280 m of the model was defined as potential open pit material, while the
remainder of the model was defined as potential underground. A cutoff grade of 0.90 g Au/t was used to
define “open pit” resources while a cutoff grade of 3.00 g Au/t was used to define “underground”
resources. The cutoff grades were established for a gold price of $600/oz. The 0.90 g Au/t cutoff is
equivalent to a recovered (96% recovery) gold value of $16.67/tonne, while the 3.00 g Au/t cutoff is
equivalent to a recovered (96% recovery) gold value of $55.56/tonne. Table 17.7 shows the resources
for the Black Fox deposit. The Black Fox resources do not include reserves.

Table 17.7 Black Fox Deposit Resources

Indicated (1) Indicated (2) Total Indicated
Elevation Tonnes Grade oz Au Tonnes Grade oz Au Tonnes Grade oz Au
9960 5.1 3.35 0.5 49.8 3.33 5.3 54.9 3.34 5.9
9930 10.5 1.30 0.4 68.3 1.55 3.4 78.7 1.52 3.8
9900 31.4 1.83 1.8 148.2 1.85 8.8 179.6 1.85 10.7
9870 45.9 2.54 3.7 257.5 2.53 20.9 303.3 2.53 24.7
9840 64.0 3.76 7.7 313.2 2.98 30.0 377.1 3.11 37.8
9810 52.0 3.73 6.2 278.0 2.85 25.5 330.0 2.99 31.7
9780 59.8 4.21 8.1 279.8 3.20 28.8 339.7 3.38 36.9
9750 64.3 7.10 14.7 275.3 4.15 36.8 339.6 4.71 51.4
9720 62.0 5.00 9.9 291.0 3.76 35.2 353.0 3.98 45.1
Subtotal 394.8 4.20 53.2 1,961.1 3.09 194.7 2,355.8 3.27 248.0
9690 36.4 9.85 11.5 107.9 9.30 32.3 144.3 9.44 43.8
9660 54.1 13.66 23.8 118.3 11.46 43.6 172.4 12.15 67.4
9630 24.4 9.10 7.1 88.4 8.95 25.4 112.7 8.98 32.6
9600 15.7 8.99 4.5 91.2 9.34 27.4 106.9 9.28 31.9
9570 31.7 9.10 9.3 127.6 8.38 34.4 159.3 8.52 43.6
9540 31.1 8.70 8.7 113.6 7.90 28.8 144.7 8.07 37.5
9510 15.6 9.81 4.9 84.8 10.26 28.0 100.4 10.19 32.9
9480 4.6 11.66 1.7 43.5 12.04 16.8 48.1 12.00 18.6
9450 1.8 5.83 0.3 9.9 8.52 2.7 11.7 8.11 3.0
9420 0.0 0.00 0.0 1.9 4.78 0.3 1.9 4.78 0.3
9390 0.1 3.74 0.0 0.6 3.46 0.1 0.7 3.50 0.1
9360 0.0 0.00 0.0 0.0 0.00 0.0 0.0 0.00 0.0
9330 0.0 0.00 0.0 0.0 0.00 0.0 0.0 0.00 0.0
9300 0.0 0.00 0.0 1.0 3.47 0.1 1.0 3.47 0.1
Subtotal 215.5 10.38 71.9 788.7 9.46 239.9 1,004.2 9.66 311.8
Totals 610.2 6.38 125.2 2,749.7 4.92 434.6 3,360.0 5.18 559.8
Model blocks that were inside a mined material solid were coded as “void”. Some of the mined areas
have been backfilled with waste materials, however a good survey of the backfilled areas is not
available. MDA assumed that half the workings have been backfilled. The blocks coded as void were
given a specific gravity of 1.0. Grades were estimated into the void blocks to reconcile the model with
past production, but were reported as waste materials.
MDA compared the material predicted by the model inside the mined solids to the actual grade and
tonnage mined. Most of the material was mined by open stoping and records were not kept of the
location of the material shipped to contract mills. A number of discussions were held with Apollo
employees who were also employed by Exall for grade control. Exall recognized that sampling was
difficult and used the occurrence of visible gold to determine if a round should be shipped to the mill
about 50% of the time. In addition, the contract for toll milling called for a minimum of 800 tpd in the
Macassa mill. These factors tend to increase the normal amount of dilution. It is difficult to determine
the cutoff utilized by Exall in completing a comparison of the actual mining to model prediction;

however the actual grade mined matches the model predicted grade using a cutoff grade of about 0.80 g
Au/t.
A total of 1.1 million tonnes grading 6.03 g Au/t (calculated head grade) containing 213,600 ounces of
gold has been mined from the deposit. Over 210,000 ounces of gold were sold by Exall from toll mill
production from the property. Table 17.8 shows the material inside the void solid that is predicted by
the model. This material is not counted in the resource summary. Note that the grade predicted at a
0.80 g Au/t cutoff grade closely resembles the calculated head grade of the 1.1 million tonnes processed,
but the model predictions are less than 50% of the total ounces actually mined.
Table 17.8 Model Estimate of Mined Material

Mined Material*
Cutoff Tonnes g Au/t Ounces Au
000's 000's
0.00 751.5 4.10 99.0
0.05 748.4 4.11 99.0
0.10 736.4 4.18 98.9
0.15 712.3 4.32 98.8
0.20 687.1 4.47 98.7
0.25 663.6 4.62 98.5
0.30 642.6 4.76 98.3
0.35 622.9 4.90 98.1
0.40 605.9 5.03 97.9
0.45 588.8 5.16 97.7
0.50 573.5 5.29 97.5
0.55 559.6 5.40 97.2
0.60 544.8 5.54 97.0
0.65 530.8 5.67 96.7
0.70 516.4 5.80 96.4
0.75 504.9 5.92 96.1
0.80 493.5 6.04 95.8
0.85 482.2 6.16 95.5
0.90 471.8 6.28 95.2
0.95 463.3 6.38 95.0
1.00 454.1 6.49 94.7
1.05 444.2 6.61 94.4
1.10 433.4 6.74 94.0
1.15 423.7 6.87 93.6
1.20 416.3 6.98 93.4
1.25 407.3 7.10 93.0
1.30 399.5 7.22 92.7
1.35 391.2 7.34 92.3
1.40 383.7 7.46 92.0
1.45 373.5 7.62 91.5
1.50 364.4 7.78 91.1
1.55 356.9 7.91 90.7
1.60 350.6 8.02 90.4
1.65 344.0 8.14 90.1
1.70 338.3 8.25 89.8
1.75 332.4 8.37 89.4
1.80 326.5 8.49 89.1
1.85 320.9 8.60 88.8
1.90 315.5 8.72 88.4
1.95 310.6 8.83 88.1
2.00 305.4 8.94 87.8
* Estimate of Indicated Material

The model predicts 95,800 ounces should have been mined, while actual records show between 213,600
and 217,100 ounces have been mined, based on toll mill calculated head grades. Using the lower
estimate, about 122.3% of more model ounces were mined than predicted by the current grade model (at
a cutoff grade of 0.8 g Au/t). While the records as to the location of the material shipped to the toll mills
are not good, the solids representing the material mined appear to be complete. The solids indicate a
total of about 1.6 million tonnes of material have been mined, including the drifting by Apollo to
establish drill hole stations, of which about 1.1 million tonnes have been sent to toll mills. This past
production can be viewed as a very large “bulk sample” that allows some conclusions. It is not
unreasonable to infer that this relationship will continue between the model based on drill hole
information and the actual material in the ground. MDA used the relationship of the actual mined
material and the model prediction to estimate inferred material. The location of inferred material,
however, cannot be estimated due to the sampling issues.
The total material estimated in the inferred class is based on the following steps. MDA started by using
the same relationship of the modeled indicated material to mined material, and assumed that the inferred
material would contain 122.3% of the indicated model ounces at a 0.80 g Au/t cutoff grade. We
assumed that the grade would be the same as the modeled indicated material at a 0.80 g Au/t. From the
ounces and grade we next calculated the tonnes of inferred material at the 0.80 g Au/t cutoff grade. We
next needed to calculate the tonnage above a zero cutoff grade. This was done by assuming that the
percentage of the estimated total tonnage for any cutoff for inferred material would be similar to the
percentage estimated tonnage of the indicated material. From the distribution of tonnage above a given
cutoff grade we next calculated the tonnage above a zero cutoff by using the 48.56% of the total for the
0.80 g Au/t cutoff, from Table 17.9. The grade for each cutoff was the same as the model estimate for
indicated material. The tonnage above cutoff was based on the same percentage of total zero cutoff
tonnage of the indicated material shown in Table 17.9. The grade and tonnage above any cutoff was
than calculated for inferred materials. The inferred material at different cutoff grades is shown in Table
17.9.
Table 17.9 Black Fox Inferred Material at Different Cutoff Grades

Indicated Inferred 1 Inferred 2 Total Inferred
% of Total Inferred - Unestimated Min Zone Inferred - Based on Mined
Cutoff Tonnes tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au
000's 000's 000's 000's 000's 000's
0.00 100.00% 3,929.1 2.18 275.5 16,967.3 2.18 1,189.6 20,896.5 2.18 1,465.1
0.10 98.39% 3,865.8 2.22 275.3 16,693.6 2.22 1,189.0 20,559.4 2.22 1,464.3
0.20 90.01% 3,536.5 2.41 273.7 15,271.7 2.41 1,182.0 18,808.2 2.41 1,455.7
0.30 79.21% 3,112.3 2.70 270.4 13,439.7 2.70 1,167.5 16,552.0 2.70 1,437.8
0.40 70.51% 2,770.3 2.99 266.5 11,962.9 2.99 1,151.0 14,733.2 2.99 1,417.5
0.50 63.52% 2,495.7 3.27 262.6 10,777.4 3.27 1,133.9 13,273.1 3.27 1,396.5
0.60 57.60% 2,263.4 3.55 258.5 9,773.9 3.55 1,116.3 12,037.3 3.55 1,374.7
0.70 52.66% 2,069.2 3.82 254.5 8,935.4 3.82 1,098.8 11,004.6 3.82 1,353.2
0.80 48.56% 1,908.2 4.08 250.6 8,240.0 4.08 1,082.1 10,148.2 4.08 1,332.7
0.90 45.09% 1,771.8 4.33 246.9 7,651.3 4.33 1,066.0 9,423.2 4.33 1,312.9
1.00 41.83% 1,643.5 4.60 243.0 7,097.2 4.60 1,049.1 8,740.7 4.60 1,292.1
1.20 36.27% 1,425.2 5.13 235.3 6,154.6 5.13 1,016.0 7,579.8 5.13 1,251.2
1.40 31.87% 1,252.1 5.67 228.1 5,406.8 5.67 984.8 6,658.9 5.67 1,212.9
1.60 28.32% 1,112.9 6.19 221.4 4,805.9 6.19 955.9 5,918.8 6.19 1,177.2
1.80 25.53% 1,003.2 6.68 215.4 4,331.9 6.68 930.0 5,335.1 6.68 1,145.4
2.00 23.26% 914.0 7.14 209.9 3,946.8 7.14 906.5 4,860.8 7.14 1,116.5
2.25 20.83% 818.3 7.73 203.4 3,533.5 7.73 878.3 4,351.8 7.73 1,081.7
2.50 18.79% 738.3 8.31 197.3 3,188.1 8.31 852.0 3,926.3 8.31 1,049.3
2.75 17.06% 670.5 8.89 191.6 2,895.3 8.89 827.3 3,565.7 8.89 1,018.9
3.00 15.67% 615.6 9.42 186.5 2,658.4 9.42 805.5 3,274.0 9.42 992.0

Using the 0.90 g Au cutoff for material to the 9720 elevation and the 3.00 g Au/t cutoff for material
below the 9720 elevation the inferred resource estimate is shown in Table 17.10.
Table 17.10 Black Fox Inferred Resource

Material Tonnes Grade oz Au
000's g Au/t 000's
Above 9720 elevation 6,626.4 4.00 852.1
Below 9720 elevation 1,228.0 9.71 383.3
Totals 7,854.4 4.89 1,235.4

18.0 MINERAL RESERVE ESTIMATE
18.1 Geotechnical Bedrock Pit Slope Studies
Golder Associates was contacted to complete a preliminary assessment of open pit slopes. The
following paragraphs were extracted from sections of their report.
The rockmass properties have been characterized by a number of different individuals at different stages
of the development of the original mine. Most recently, work has been completed on the structural
geology of the A1 Zone by Barclay (2000). Barclay identifies 3 major fault/slip planes in this zone with
relatively complex slips along shallow to steeply dipping slickensided planes. An analysis of the near-
surface (<50m) rockmass, including UCS, point load and other laboratory test results, as well as joint
mapping and description has been completed by Newmann as well as Marisett. Using the Barton
Rockmass Classification System, Newmann estimates that the rockmass quality (Q) ranges from 0.5 to
2.7, which classifies it as Very Poor to Poor Rock for the “U” zone. Neglecting stress and groundwater
effects (Q’), the modified rockmass classification changes to a range between 2.67 and 10, thereby
changing the classification to Poor to Fair Rock.
Newmann also observed an improvement in rockmass condition at depth with an increase in clamping
stress as well as a decrease in weathering effects and water inflow. Marisett used the Barton System to
classify the rockmass according to regions as follows:
Area 1 (Northwest Region) Q’ = 2 to 10 (Poor to Fair Rock)

Area 2 (Northeast Region) Q’ = 5 to 30 (Fair to Good Rock)
Area 3 (Southeast Region) Q’ = 2.5 to 7 (Poor to Fair Rock)
Area 4 (Southwest Region) Q’ = 2.5 to 7 (Poor to Fair Rock)
In addition, Mariset identified four fault groups with apertures ranging from 1 to 100 cm and an
infilling ranging of one or a combination of gouge, chlorite, sericite, quartz and or talc. Most of the
work in rockmass characterisation thus far has encompassed that in ore, this information will prove
useful when considering the design of the pit footwall. However, the rockmass quality of the
hangingwall and sidewalls will have to be characterized as well. A preliminary consideration of this
regional rockmass using core drilling results in Sections 1000E, 10125E, 10225E, 10275E and 10350E
indicates that there are three main rock units to consider:
An ultramafic volcanic with chlorite and talc chlorite sections underlying the overburden. This
unit has RQD values ranging from as low as 15 up to 95, but generally averaging at around 70.
Lower RQD values generally occur closer to the surface. Approximately 30 to 70% of the south
wall (hangingwall) would comprise this unit.
An underlying metabasalt with RQD values ranging from 82 to 100, with values averaging out
at around 97. This unit should comprise the remainder 30 to 70% of the south wall not
composed of the ultramafic volcanic.

Fault/breccia shear zone with RQD values of 20 or less. These zones can be found within both
of the above rock units and range in thickness (along core) from 1 to 23 m.
The ultramafic volcanic unit appears to be thicker in the western portion of the deposit thinning out to
the east along the same northing (9800N to 9900N), conversely the opposite can be said of the
metabasalt unit.
The north wall will be in the footwall of the orebody. The rock properties described above indicate Poor
to Fair Rock. In general, the south, east and west walls of the open pit will be in relatively hard and
massive volcanic rock. Shear zones will intersect the pit walls and their number and orientation are not
known. Also, the presence, orientation and other physical properties of joint sets and faults are not
known. For these reasons the rock slope parameters provided below should only be used for coarse pit
shell assessment and not detailed planning or feasibility study pit analysis.
The rock slope parameters are based on the following assumptions:
Pit wall component terminology is defined as per Figure 18.1;

Calculation of the inter-ramp angle is as shown in Figure 18.2;
All rock types are sufficiently strong that bench face angles will be controlled by geological
structure and blasting practices. Inter-ramp and overall slope stability will be a function of
bench configuration;
The ultimate mining depth will be 150 m;
The bench height will be 3 m in ore for grade control reasons and 6 m or 9 m in waste depending
on equipment sizes;
Careful wall control blasting techniques will be used adjacent to all final bench faces in rock;
Artificial rock support (i.e., cable bolts, rock bolts, etc.) may be required to support potential
bench scale slope instabilities;
Catch berm widths will generally be a minimum of 8 m; and
The slopes will drain naturally, either to the face or to the underground workings below, or can
be depressurized by artificial means (horizontal drain holes, etc.).
The initial rock slope parameters are:
North Wall - Inter-ramp angle 45 degrees or less. Defined by the dip of the orebody.
o Maximum 18 m vertically between catch berms
o Minimum 8 m catch berm width
o Bench face angle 60 degrees or less
South Wall - 18 m vertically between catch berms

o Minimum 8 m catch berm width
o 75 degree face angle
o 54.5 degree inter-ramp angle
East & West - 18 m vertically between catch berms

o Walls - 9 m catch berm width
o 70 degree face angle

o 49.2 degree inter-ramp angle
An 8 m catch berm width is the minimum width that will provide adequate catchment for any falling
material and also allow access to clean the berm. Access to each of the catch berms for cleaning
purposes must be maintained.
There is little oriented structural data for the hangingwall rock; therefore, the potential for structurally
controlled slope failures on the south, east and west walls cannot be evaluated. A geotechnical drilling
program is required to determine the presence and orientation of structural features for the hangingwall
rock types. The rock slope parameters provided above are typical of similar deposits in the region but
must be confirmed through additional investigation and analyses. In addition, an ongoing program of
pit slope inspections, geotechnical face mapping and structural analysis carried out by qualified people
would be required during the start-up and operation of the open pit mine.
An initial scope for a preliminary geotechnical drilling program to assess rock slope stability would
involve angled diamond drill holes through the proposed south wall of the pit. Three of the holes would
have a dip direction approximately to the south and perpendicular to the strike of the orebody so they
intercept the pit wall at an acute angle. The fourth hole would be drilled with a dip direction towards
the north such that the hole roughly parallels the final wall. All holes would be drilled at approximately
65 degree dip. The core would be oriented using a core orientation technique, then it would be
structurally logged by an experienced geotechnical specialist.
The structural data obtained from the drill core would be combined with the structural data from
underground, then analysed using stereonet techniques. A stereo net would be developed for each of the
main rock types and from these the orientation of discontinuities (joint sets, shear zones and faults)
would be determined. This information would be used in a kinematic analysis of the stability of the pit
slopes.
The minimization of dilution of the ore will be a critical element of the mining operation due to the
characteristics of the orebody. For this reason, it is expected that the ore will be mined in 3 m lifts or
benches. It is expected that the drill cuttings from all blastholes will be sampled and assayed in order to
provide the basis for ore grade control. The sampling requirements may dictate the spacing of the
blastholes and this in turn would impact the blasthole diameter. If this is not the case, then the blasthole
diameter would be in the range of 4 – 6 inches which is the maximum practical for 3 m high benches.
Blasting in the ore would likely be on 3 m high benches so that identification of ore blocks can be
carried out with the most accuracy and the material can be mined with the minimum of dilution. Choke
blasting of the ore would be used in order to minimize movement and subsequent dilution of the ore
blocks. Careful control of the stemming length in the blasts will be required in order to control flyrock
and loss of ore.

Figure 18.1 Slope Design Elements

Figure 18.2 Bench Geometry and Inter-ramp Angle

18.2 Black Fox Overburden Slopes, Waste and Overburden Stockpiles
AMEC completed a “Pre-feasibility Design Study of Open Pit Overburden, Waste Stockpiles and
Tailings Impoundment” in December 2004. The following paragraphs were extracted from their report.
The tailings impoundment discussion can be found in Section 22.
18.2.1 Overburden Slopes
For the proposed open pit, the stability of the overburden slope is a primary consideration due to the
loose and wet silty materials encountered at the site. Also, potential impact of pit dewatering on the
adjacent lake (Froome Lake) as well as the impact of the pit and mine operation on the highway (e.g.,
blasting, potential highway settlement from lowering groundwater level, traffic) are of concern. In this
study, attention is focused on the slope stability issue.
The potential impact of pit dewatering on the lake will be addressed in a hydrogeological study report.
Potential for highway settlement will be addressed at the feasibility design level. This issue is not
considered critical to the project at this stage. The issues of highway traffic and blasting next to the
highway are being addressed under the “permitting” part of the project.
A settling pond for pit water will be required to settle suspended solids. Water from dewatering of the pit
may also require chemical treatment, e.g., for arsenic. Further geochemical evaluation will be required
to determine treatment requirements, after the pit geological model is available. For the purpose of this
study, it has been assumed that no treatment other than for suspended solids will be required for the pit
water, including also water collected in the underground workings.
It is noted that it might or might not be feasible to utilize the tailings impoundment as a settling
impoundment for the pit water, depending on the cyanide destruction strategy. Consistent with the
previous studies by Apollo, it is assumed that the tailings impoundment excess water will be treated in
the mill, after reclaiming from the tailings pond (i.e., no discharge from the tailings impoundment will
be permitted). Hence, for the purpose of the current study, pumping pit water to the tailings
impoundment is not considered feasible since the tailings pond water will be subject to cyanide
treatment.
It is noted that should the pit water require treatment for arsenic, it would have to be pumped from the
pit settling pond to the mill and then, possibly, mixed with the tailings pond water after the cyanide is
destroyed (prior to treatment for arsenic).
In summary, for the purpose of this pre-feasibility design study, it is assumed that the pit water will
require treatment for suspended solids only and will be released to the environment at a distinct
discharge point.
No specific site closure requirements with respect to the open pit have been incorporated into the
designs at this stage. It is assumed that the pit will be allowed to flood and thus form a small lake.

Stability of the overburden slope under static loading conditions: Factor of Safety ≥ 1.5. The seismic
stability of the pit slopes has not been addressed at this stage and will have to be accounted for in the
next design phase. Adjustments to the pit design slopes might then have to be introduced.
Four typical sections approximately corresponding to the east, south, west and north sides of the
proposed open pit were developed for slope stability modelling conducted to determine the safe angles
of the excavated overburden slopes. A limit equilibrium method was employed through using computer
software Slope/W version 5.
The subsurface conditions for each identified section of the pit were selected based on the results of the
field investigation in the area of the proposed open pit. Soil parameters were estimated from field and
laboratory investigation results. The groundwater levels were based on the most recent readings of the
piezometers. For each slope, different failure mechanisms (i.e., different slip surfaces through critical
soil layers) were considered to examine both overall and local stability of the slopes.
A factor of safety of 1.5 is considered to be a minimum safety margin against slope failure. The factor of
safety for the overall stability is between 1.47 and 1.80, and for other potential slip surfaces, the factor
of safety is between 1.49 and 2.81.
Based on the above findings, the north and west open pit slopes would be excavated at 3 horizontal to 1
vertical (3H:1V). However, the east and south slopes would have to be excavated at 5H:1V due to the
presence of very loose to compact silty sand till on the south side, and firm silty clay on the east side of
the open pit.
The overall slope of 3H:1V to 4H:1V for the various segments of the open pit is considered to be
adequate from the stability perspective, under the assumption that the slope configuration will not
change with time.
At this pre-feasibility design level, only static loading conditions were considered in determining the
safe pit overburden slopes. The stability of the slopes under seismic conditions, accounting for the
liquefaction potential, will be examined at the feasibility design level. Also, potential for soil
liquefaction under seismic loads generated from blasting in the pit will be addressed at that stage.
It is noted that even though the overall slope, as shown, has an adequate margin of safety from the
perspective of resistance to shear failure, this safety margin could be easily be affected by erosion of the
slope (by surface water and/or groundwater), which could be extensive in the silty and fine-grained sand
materials. Therefore, erosion protection over the pit overburden slopes will likely be required.
18.2.2 Waste Rock Stockpile
18.2.2.1 Waste Rock Characterization
Based on the available data, it appears that although the waste rock would not generally be net acid
generating. The concentrations of As and Ni dissolved from the rock could be marginal with respect to
discharge limits, however, this is a preliminary conclusion drawn from the BC MEM test results only. It
is noted that As and Ni could be released from the waste rock during flushing events (e.g., during spring
runoff and/or fall rains) in concentrations exceeding regulatory limits. The concentration of ammonia
in the surface water derived from the waste rock also appears to be high, and in excess of regulated
values.
The source mineral(s) containing arsenic still is unclear, however, the review of the current data
suggests that more than one mineral source is possible. In summary:
Some arsenic occurs in arsenopyrite (identified in sample Apollo 12).

Arsenic may also substitute within the structure of other sulphides such as pyrite.
The leach data suggest that release of arsenic is not consistent with the oxidation of sulphide
minerals and that arsenic may also be associated with an arsenate salt such as scorodite.
Based on the available data, it appears that arsenic found in the rock samples is associated with some
identifiable rock types and mineral fractions. The concentration of arsenic in the samples increased
with carbonate contents as estimated by three separate methods. The highest concentrations of arsenic
are associated with samples identified as “green carb” and “grey carb”, but not all samples dominated
by carbonate necessarily contain high concentrations of arsenic. This suggests that arsenic may also
exist in accessory mineral(s) associated with samples predominated containing carbonate.
18.2.2.2 Waste Rock Stockpile Design
For the waste rock stockpile, physical stability of the dump slopes, required footprint area and the
potential for arsenic leaching are the primary design considerations. The subsurface conditions
explored during the summer 2004 field investigation indicated that the South Block is the most
favourable location for the waste rock stockpile.
Site selection and optimization of the stockpile configuration (accounting for the geotechnical site
conditions) have been the main focus of this study with regard to the waste rock stockpile, with two
possibilities addressed:
the stockpile runoff may/may not require treatment for arsenic.
Regardless of the runoff treatment requirements, runoff from the waste rock stockpile will have to be
routed through a settling facility to control the level of suspended solids. No specific closure
requirements have been incorporated into the waste rock stockpile designs at this stage, except that the
slopes will have to remain stable in the long-term. While it has been assumed that no special cover over
the stockpile would be required, an allowance needs be made for some nominal grading, soil cover, and
vegetation work.
Design criteria:
Total waste rock mass: 44 million tonnes.

Slope stability under static loading: Factor of Safety ≥ 1.3 (seismic stability will be addressed at
the next design stage).
Buffer zone to the adjacent lakes: ≥ 100 m.

Buffer zone to other property lines: 50 m.
The proposed waste rock stockpile will be located in the beaver pond and low lying areas to the south of
the open pit and to the west of the bedrock outcrop. Field investigations indicate that the subsurface
soil comprises generally dense to very dense sand and silt overlying bouldery till. The stratum of dense
sands and silts presents a competent foundation for the relatively high stockpile of waste rock.
However, in the northwest area of the proposed footprint, the silty clay layer (encountered in BH04-40)
presents a relatively weak foundation layer. Hence, two models were developed to determine the
required overall slope angles for the stockpile.
The soil parameters used for each subsurface unit were estimated from the field and laboratory tests
results and the phreatic surfaces were based on the measured groundwater levels. In view of the design
safety factor of 1.3 set for the waste stockpiles, the tests indicate that the waste rock can generally be
stockpiled to a height of 50 m with 2H:1V side slopes in most of the areas. Along the northwest segment
of the stockpile, the waste rock should be placed higher than 40 m if a slope of 5H:1V is to be
maintained (due to the presence of the silty clay stratum).
The arrangement for collecting and managing waste rock stockpile runoff for arsenic treatment, if
required, is discussed in Section 22.
Closure For the waste rock stockpile, the exterior slopes will be stabilized, where required. Some
material from the overburden stockpile will be used at locations at the top and on the slopes of the
stockpile to accelerate the start up of vegetative growth.
18.2.3 Overburden Stockpile
For the overburden stockpile, the strength properties of the (re-worked) overburden waste, physical
stability of the dump slopes and the required footprint area are the primary design considerations.
The subsurface conditions explored during the field investigation carried out in the summer of 2004
indicated that the West Block is favourable for siting of the overburden stockpile. The strength
properties of the reworked overburden materials have been assumed based on the results of
geotechnical investigation carried out within the proposed pit area.
The runoff from the overburden stockpile will have to be routed through a settling facility to control the
level of suspended solids.
Similar to the waste rock stockpile, no specific closure requirements have been incorporated into the
overburden stockpile designs at this stage, except that the slopes will have to remain stable in the long-
term. Some of the stockpiled overburden material may be used for final reclamation of other project
areas. As a minimum, an allowance needs be made for some nominal grading and vegetation of the
stockpile.

Design critera:
Total overburden mass: 11 million tonnes

Slope stability under static loading conditions: factor of safety ≥1.3.
Buffer zone to the adjacent lakes: ≥100 m.
Buffer zone to the highway: ≥100 m.
Buffer zone to other property lines: ≥50 m.
Based on the field investigation carried out in the summer of 2004, the overburden soils at the open pit
site primarily consist of compact silt, sand and till deposits. This indicates more advantageous soil
conditions for handling and stockpiling as compared with those expected during the fatal flaw study.
This has an implication regarding the slope design for the overburden stockpile in consideration of the
effects of the strength of overburden (stockpiled) soils on the slope stability.
The West Block is generally underlain firm silty clay, loose to dense silty sand to sandy silt and till
deposits with the exception of the southeast areas close to Froome Lake, underlain by a layer of soft
clay. Slope stability analyses were carried out to design the stockpile configuration for 11 million tonnes
within the limits of the West Block.
The results (of the stability analysis) indicate that the construction of a 25 m high overburden stockpile
with side slopes of 4H:1V is generally feasible. However, in southeast area of the stockpile footprint
underlain by the soft silt clay deposit, the overall side slope should be 14H:1V or flatter. In other
words, extensive “stabilizing berms” will be required at that location.
18.3 Black Fox Deposit Pit Optimization
Reserves for the Black Fox deposit were calculated by completing a pre-feasibility study for the project
based on producing 1,500 tpd (540,000 tpy) of ore from an open pit. Several options were considered:
Base Case – Owner mining and Owner milling

Option 1 – Owner mining and Toll milling
MDA completed a Lerchs-Grossman pit optimization of the measured and indicated material contained
in the updated grade model. Some of the mined areas are backfilled. MDA estimated that 50% of the
workings have been backfilled with material having a density of 2.0 t/m3. Since the location of the
backfilling is unknown, all of the workings were given a density of 1.0 t/m3. Pit optimization
parameters are listed below, with all costs noted in $U.S.:
Overburden mining cost - $1.25 per tonne of material;

Rock mining cost - $1.50 per tonne of material;
Processing cost - $12.16 per tonne ore;
General and Administrative cost - $4.50 per tonne ore;
Plant gold recovery – 96%;
Pit Slopes – Measured from the 2004 design shown in Table 18.1 for rock, and 19o overburden.

Table 18.1 Pit Slopes For Optimization

Pit Segment N NE E SE S SW W NW
Interslope Angle 45 42 39 43.5 47 47.5 48 46.5
Table 18.2 summarizes the results of the pit optimization at gold prices between $250 and $700 per
ounce. A cutoff grade of 0.96 g Au/t was calculated at a $550 per ounce gold price. Several other cutoff
grades are shown for comparison purposes.
Table 18.2 Pit Optimization Results

Gold Price Indicated 1 Indicated 2 Total Indicated Waste Strip Ratio
$/oz Au cutoff tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes g Au/tonne oz Au tonnes t waste/t ore
g Au/t 000's 000's 000's 000's 000's 000's 000's
250 2.12 109.3 10.68 37.5 344.0 8.97 99.2 453.3 9.38 136.7 7,616.4 16.8
275 1.93 131.7 10.32 43.7 430.9 8.18 113.3 562.7 8.68 157.0 9,386.8 16.7
300 1.77 168.3 9.63 52.1 495.9 7.71 123.0 664.1 8.20 175.1 11,639.7 17.5
325 1.63 385.2 7.72 95.6 995.0 6.55 209.5 1,380.2 6.87 305.0 28,391.0 20.6
350 1.51 495.8 7.10 113.1 1,402.3 5.99 269.9 1,898.1 6.28 383.0 38,984.4 20.5
375 1.41 540.4 6.70 116.4 1,588.4 5.58 284.8 2,128.9 5.86 401.2 40,417.0 19.0
400 1.32 568.5 6.45 117.9 1,697.1 5.34 291.1 2,265.7 5.62 409.1 40,910.3 18.1
425 1.25 595.6 6.24 119.5 1,787.1 5.15 295.8 2,382.6 5.42 415.2 41,189.0 17.3
450 1.18 626.3 6.02 121.3 1,916.6 4.92 303.2 2,543.0 5.19 424.4 42,073.1 16.5
475 1.12 649.7 5.85 122.2 2,010.5 4.75 307.0 2,660.2 5.02 429.2 42,128.7 15.8
500 1.06 672.0 5.69 123.0 2,107.2 4.59 311.2 2,779.2 4.86 434.2 42,258.6 15.2
525 1.01 695.3 5.55 124.0 2,201.6 4.46 315.7 2,896.9 4.72 439.8 42,695.5 14.7
550 0.96 725.0 5.41 126.0 2,302.8 4.36 322.7 3,027.8 4.61 448.7 44,224.0 14.6
575 0.92 753.3 5.27 127.5 2,407.4 4.24 328.3 3,160.7 4.49 455.8 45,264.6 14.3
600 0.88 775.2 5.15 128.5 2,502.6 4.13 332.6 3,277.9 4.38 461.1 45,842.6 14.0
625 0.85 797.1 5.05 129.3 2,584.2 4.05 336.1 3,381.2 4.28 465.4 46,341.9 13.7
650 0.82 833.1 4.90 131.2 2,710.8 3.94 343.3 3,543.9 4.16 474.5 48,191.3 13.6
675 0.79 861.4 4.79 132.6 2,804.0 3.86 347.5 3,665.4 4.07 480.1 49,113.6 13.4
700 0.76 889.9 4.69 134.2 2,907.5 3.77 352.1 3,797.4 3.98 486.3 50,073.0 13.2
The difference between the $325 and $350 gold price optimized pits is significant. The $350 pit
increases about 11 million tons in size compared to the $325 optimized pit. The jump in pit size is due
mainly to high-grade material defined by underground drilling. MDA believes that additional
confirmatory drilling and/or drifting to further refine the definition of this material is justified.
The pit changes in size beyond the $350 gold price is relatively minor, and the change in tonnage of ore-
grade material is probably more due to cutoff grade reduction than addition material from the slightly
larger pit.
18.4 Black Fox Pit Design
The optimized $600 gold pit was used as a basis for pit design with cutoff grades based on a $550 gold
price. The pit was designed with a 20 m wide 10% ramp system narrowing to a 10 m wide single lane
ramp near the pit bottom, 3:1 pit slopes in alluvium, and Golder Associates recommended inter ramp
angles discussed in Section 18.1.
The pit was designed in two phases. The initial phase starts on the eastern portion of the deposit where
near-surface high-grade material has been drilled on 12.5 m centers. The phase one pit can be designed
so that some backfilling can be accommodated during Phase 2 mining. The material in the pit is
summarized in Table 18.3. Table 18.4 summarizes the probable reserves contained in the Black Fox
open pit design based on a $550 gold price internal cutoff, and the base case production schedule. Since
there are no measured resources, there are no proven reserves. Table 18.5 shows the base case
production schedule for the project. Figure 18.3 shows the Phase 1 pit, while Figure 18.4 illustrates the
final pit. A separate pit was designed for the Toll milling case, however, the base case pit design
provided better economics and was used for this study.
Table 18.3 Pit Design Summary

Pit Phase Cutoff Above Cutoff (Indicated Class) Glacial Till Void Rock Waste Total Waste Strip Ratio
g Au/t 000's tonnes g Au/t 000's oz Au 000's Tonnes 000's Tonnes 000's Tonnes 000's Tonnes
1 0.80 1,532.5 4.08 200.9 5,612.8 41.1 18,292.9 23,946.8 15.6
1 0.96 1,350.8 4.51 195.7 5,612.8 41.1 18,474.5 24,128.4 17.9
1 1.25 1,099.6 5.28 186.8 5,612.8 41.1 18,725.8 24,379.7 22.2
1 1.65 868.7 6.31 176.2 5,612.8 41.1 18,956.6 24,610.5 28.3
1 1.90 769.9 6.89 170.5 5,612.8 41.1 19,055.4 24,709.3 32.1
2 0.80 1,896.0 4.24 258.3 4,093.1 153.3 18,671.8 22,918.2 12.1
2 0.96 1,711.9 4.60 253.1 4,093.1 153.3 18,855.9 23,102.3 13.5
2 1.25 1,438.4 5.26 243.5 4,093.1 153.3 19,129.4 23,375.8 16.3
2 1.65 1,142.3 6.25 229.7 4,093.1 153.3 19,425.6 23,671.9 20.7
2 1.90 1,007.3 6.85 222.0 4,093.1 153.3 19,560.5 23,806.9 23.6
Totals 0.80 3,428.5 4.17 459.2 9,705.9 194.4 36,964.7 46,864.9 13.7
Totals 0.96 3,062.7 4.60 448.8 9,705.9 194.4 37,330.4 47,230.7 15.4
Totals 1.25 2,538.0 5.27 430.3 9,705.9 194.4 37,855.2 47,755.4 18.8
Totals 1.65 2,011.0 6.28 405.8 9,705.9 194.4 38,382.2 48,282.4 24.0
Totals 1.90 1,777.2 6.87 392.5 9,705.9 194.4 38,616.0 48,516.2 27.3
Table 18.4 Probable Black Fox Reserves

Probable 1 Probable 2 Total Probable 000's Tonnes Waste Materials
Pit 000's Tonnes g Au/t oz Au 000's Tonnes g Au/t oz Au 000's Tonnes g Au/t oz Au Overburden Void-Fill Rock Waste Total Waste
Phase 1 297.1 5.31 50.7 1,053.7 4.28 145.0 1,350.8 4.51 195.7 5,612.8 41.1 18,474.5 24,128.4
Phase 2 438.9 5.38 76.0 1,273.0 4.33 177.1 1,711.9 4.60 253.1 4,093.1 153.3 18,855.9 23,102.3
Totals 736.0 5.38 126.7 2,326.8 4.33 322.2 3,062.7 4.60 448.8 9,705.9 194.4 37,330.4 47,230.7

Table 18.5 Base Case Production Schedule

Total Till Rock
Waste Waste Waste Ore Ore Ore
Period Pit Phase Tonnes Tonnes Tonnes Tonnes g Au/t oz Au
000's 000's 000's 000's 000's
Preproduction Phase 1 7,934.8 5,353.5 2,581.3 103.8 6.05 20.2
1 Phase 1 8,875.3 259.3 8,615.9 540.0 4.71 81.8
2 Phase 1 4,906.2 0.0 4,906.2 471.3 4.22 63.9
2 Phase 2 4,839.1 3,892.5 946.7 68.7 7.24 16.0
2 Total Total Yr 2 9,745.3 3,892.5 5,852.9 540.0 4.60 79.9
3 Phase 1 2,412.2 0.0 2,412.2 339.5 4.58 50.0

3 Phase 2 5,162.0 200.6 4,961.4 200.5 4.94 31.8
3 Total Total Yr 3 7,574.2 200.6 7,373.6 540.0 4.71 81.8
4 Phase 2 7,679.4 0.0 7,679.4 540.0 4.02 69.7

5 Phase 2 3,455.1 0.0 3,455.1 540.0 5.17 89.8
6 Phase 2 1,966.5 0.0 1,966.5 362.7 3.92 45.8
Totals Final Pit 47,230.7 9,705.9 37,524.8 3,062.7 4.56 448.8

Note: Preproduction ore is processed during year 1 and is shown in both the preproduction and year 1 schedule.

Figure 18.3 Black Fox Phase 1 Pit Design
Reno Nevada
APOLLO GOLD
Black Fox Project
Phase 1 Pit Design
Matheson Ontairo

Figure 18.4 Black Fox Project Final Pit Design
Reno Nevada
APOLLO GOLD
Black Fox Project
Final Pit Design
Matheson Ontairo

19.0 OTHER RELEVANT DATA AND INFORMATION
Apollo is in the process of evaluating the property by open pit and underground mining methods. The
process of evaluation includes investigation of alternatives of continuing to process any material
produced by contract milling or by construction of a new mill on the project site. The economic
evaluation for the calculation of reserves will include an investigation of open pit mining only and on-
site and off-site processing. The potential of underground mining needs to be evaluated based on the
results of a proposed bulk sampling program to check the grade model.
All of the past production from the property is by underground mining methods. Cash costs in US$
reported by Exall (2000 Annual Report) are shown in Table 19.1.
Table 19.1 Exall Reported Cash Costs
Year Production Waste Cash Cost

Cost Development
$/oz au $/oz au $/oz au
1998 $184.51 $54.47 $238.98
1999 $219.08 $35.54 $254.62
2000 $160.61 $121.31 $281.92

20.0 INTERPRETATION AND CONCLUSIONS
The Black Fox deposit is a coarse gold deposit with a number of parallel structures. Occasionally,
mineralized dikes and other structures cross the mineralized zones, adding complexity to the deposit.
The ankerite alteration zones are thicker in the western and eastern portions of the deposit. In addition,
the zones appear to thicken near the surface and with depth. The mineralized zones appear to be open at
depth and to the east and west.
coarse gold in the deposit, and result in samples that tend to contain less gold than is actually present.
They are actually the same problem and are based on sample size issues and coarse gold.
The first issue is to get a large enough sample to represent the area sampled. The gold at the Black Fox
deposit appears to be concentrated in small areas. When the gold is concentrated in small areas, drill
hole samples will occasionally get too much gold in the sample when the area of concentration is
intersected or more often miss the area of concentration and get too little gold in the sample. The core
holes that form the basis for the resource and reserve estimate are too small to obtain a representative
sample. Some samples may even appear to be waste without the concentrated gold. It is likely that
holes several meters in diameter would be required to obtain representative samples of the deposit.
MDA reviewed areas that were penetrated by drill holes prior to mining, and commonly areas that were
stoped appeared to be un-mineralized based on the drilling.
The second problem is getting the representative amount of gold in the sample pulp once the sample has
been obtained. Gold particles up to 0.15 cm have been observed and particles of 0.06 cm are very
common (Pitard, 2005). The proper sample size is required in order to get a representative sample
again, but this time we have all of the gold contained in the sample somewhere in the core. With coarse
gold it is easy to create sub-samples that contain too many or too few gold particles if the sample size is
not based on the size of the gold particles in the deposit. In order to sample the 0.15 cm gold particles
that occur at Black Fox, samples of up to 109 kg must be processed in their entirety (Pitard, 2005). If
the sample contains 0.06 cm gold particles, which commonly occur in the deposit, a 7 kg sample must
be processed in its entirety (Pitard, 2005). These sample sizes are much larger than the typical 30 g fire
assay sample or even the generally 1,000 g screen metallic assay sample. Once again, a few assays
containing too much gold, with far more containing less than is actually present in the whole sample.
Francis Pitard’s report on the sampling issues is shown in Appendix B. A very interesting website with
considerable information on coarse gold can be found on the Bendigo Gold Mine website:
http://www.bmnl.com.au . This website contains a number of technical papers regarding coarse gold.
in grade, but far more that are too low in grade. Francis Pitard concluded in his 2005 report on Black
Fox mineralization that:


database..
MDA believes that both the size of the sample to measure the gold in the deposit and the size of the
sample to measure the gold in the sample are too small, and will result a database where some samples
represent a higher sample grade than is present at the sample location, but many samples represent too
low a grade than is present at the sample location. MDA concurs with Pitard’s conclusion, that the drill
hole data is likely biased and will likely underestimate the contained gold within the deposit.
MDA believes that more mini-bulk samples and metallic screen tests are warranted. Both the mini-bulk
samples and the metallic screen assays have tested more high-grade than is typically contained in the
mineralized zone. The problem with testing more high-grade material than the average is that the results
could be misleading. With coarse gold two principals occur often. First, some of the higher grade
samples contain more gold than is representative of the area sampled, but many will under-represent the
contained gold of the area sampled. Second, when the sample is prepared, and is too small based on the
particle size of the gold occurring in the deposit, some of the high-grade pulps will contain more gold
than contained within the entire sample, but many of the lower grade samples will contain less gold than
is representative of the entire sample. MDA believes that additional mini-bulk samples and metallic
assays on average mineralized sample grades will show grade improvement compared to the original fire
assays.
The database needs improvement in the area of check assay information of the old drilling data. MDA
recommends that if the original check assay data can be located for both the Noranda and Exall, data it
should be included in the database. In addition many un-assayed intervals may contain ore grade
intervals that have not been assayed. MDA suggested that about 20,000 m of the old drilling should be
prepared for assay or re-assayed. Apollo has completed a portion of this suggested work.
The development of the initial resource and reserves is based on drilling on 25 m centers, with the
exception of a near-surface high-grade area. This spacing should be reduced to 12.5 m spacing to
finalize mine plans. Metallic assays should be considered the standard method of assaying for the
coarse gold deposit.

21.0 RECOMMENDATIONS
MDA recommends that a feasibility study be completed for the open pit portion of the project, and that
underground bulk sampling with some additional drilling be completed for the project. The purpose of
the underground bulk sampling is to confirm that the model is underestimating the contained gold.
The pit bottoms of the current designed pit are based on high-grade material intersected by underground
drilling. This material should also be tested on closer spaced drilling. It may be possible to reduce the
overall strip ratio of the open pit by mining some of the material near the pit bottom by underground
methods. The interface between the pit bottom and the potential start of the underground mine needs
more detailed drilling in order to plan the location and design parameters for the crown pillar.
The following feasibility program should be completed for the project:
Resources and Reserves:

Check sample selected intervals by metallic assaying. At least 5-10% of the material inside the
mineralized zones should be checked by metallic assay. The average grade of the metallic check
samples should match the average grade of the mineralized zones at a zero cutoff. This will help
to get a handle on one of the two sampling issues.
Complete about 150 mini-bulk sample gravity checks on drill hole composite samples. The
average grade of the samples tested should be equivalent to the average grade of the mineralized
zone at a zero cutoff. Again, this will help get a handle on how much gold was missed by the
small samples originally assayed.
Design and complete a bulk sampling program for the green carbonate and “flow ore”
mineralization types. The bulk sampling program should be designed to determine differences
between grade model and actual mineralization. The biggest problem will likely be to define
what is and is not mineralized material. We believe that a small gravity plant should be set up to
determine if a round mined is mineralized or not. This sampling plant will properly reduce each
round to a sample that can be processed by gravity. We do not believe that channel and muck
sampling will be successful in determining the actual grade of mineralized rounds, however,
there is a better probability if large samples are taken and the face samples on both sides of the
round are used to determine if a round is mineralized. We believe that if the mill processing the
sample does not have a gravity circuit, the test may not be appropriate without a small gravity
plant on site to obtain a good head grade sample. The bulk sample should check an area that
contains the typical grade distribution of the deposit and not concentrate on high-grade areas.
Extend the 235 level to the east and continue to develop the “flow ore” mineralization
Open Pit Mine:
Condemnation drilling of tailings, rock, and overburden stockpile areas;

Feasibility level geotechnical and hydro-geologic studies should be completed to confirm

overburden slopes, and tailings design parameters;
More testing is required for the potential leaching of metals that require treatment from waste
materials;
Geotechnical mapping of the underground workings;
Mapping of the underground workings to show areas that are open (rather than containing fill);
Penetration Rate Testing – Obtain 1 ft x 1 ft samples of representative ore and waste, say 10
samples of each. Get the samples to drill vendors for testing;
Oriented core drilling for rock mechanics of typical ore and waste areas. Golder is suggesting 6-
8 holes of NQ size with geotechnical logging;
Ore and waste rock strength testing;
Geologic mapping of the underground to compare to existing maps;
Continue to run check samples on selected intervals by metallic assaying.
Underground Mine:
Bulk sample selected areas to check model prediction of grade and tonnage;
Oriented core drilling of a few holes with geotechnical logging;
Rock strength testing;
Ventilation study – (after initial mine design);
Backfill requirements – (after initial mine design);
Metallurgical Testing
Bottle roll characterization with thin section mineralogy;
Semi-autogenous grinding amenability tests (Lakefield quote - CDN $72,500);
Testwork required to confirm reagent consumption assumptions used in the pre-feasibility study,
based on the Lakefield 1999 test program (Lakefield quote - CDN $46,040).
Utility Supply
Power supply review;
Water supply review.

22.0 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT

PROPERTIES AND PRODUCTION PROPERTIES
22.1 Site Map
A site map was prepared by AMEC in their “2004 Pre-Feasibility Design Study for Open Pit
Overburden, Waste Stockpiles and Tailings Impoundment.” This site plan is shown in Figure 22.1 with
the current pit design superimposed on the map in place of the 2004 design. Since the size of the current
pit is slightly smaller than the 2004 design, the stockpiles shown are slightly larger than necessary.
22.2 Production Schedule
A production schedule was developed for the property from mining the Phase 1 and Phase 2 pits at the
rate of 1,500 tpd. Prior to the production of gold about 8 million tonnes of alluvium and waste rock
material must be removed from the Phase 1 pit to enable a constant flow of ore from the pit at the rate of
1,500 tpd. Stripping over the first three years of the operation is high, as shown in Table 22.1 for the
Owner Milling case. A site plan for the Black Fox operation (Owner Milling option) is shown in Figure
22.1.
Table 22.1 Black Fox Production Schedule (Owner Milling)
Year Preproduction 1 2 3 4 5 6 Totals

Tonnes Ore (000's) 103.8 540.0 540.0 540.0 540.0 540.0 362.7 3,062.7
Grade g Au/t 6.05 4.71 4.60 4.71 4.02 5.17 3.92 4.56
Ounces Au (000's) 20.2 81.8 79.9 81.8 69.7 89.8 45.8 448.8
Tonnes Till (000's) 5,353.5 259.3 3,892.5 200.6 0.0 0.0 0.0 9,705.9
Tonnes Rock Waste (000's) 2,581.3 8,615.9 5,852.9 7,373.6 7,679.4 3,455.1 1,966.5 37,524.8
Tonnes Total Waste (000;s) 7,934.8 8,875.3 9,745.3 7,574.2 7,679.4 3,455.1 1,966.5 47,230.7
22.3 Mining
The Black Fox open pit will be mined using Apollo’s current fleet supplied from the Montana Tunnels
project, supplemented with some new equipment purchased in years 2 and 3 of the operation. The
available mine equipment from Montana Tunnels is shown in Table 22.2. On August 1, 2006, Apollo
announced a joint venture with Elkhorn Tunnels, LLC on the Montana Tunnels deposit. Apollo noted to
MDA that the effect of the newly announced joint venture on the potential use of Montana Tunnels
equipment for the Black Fox project is unclear at this point for the drills and some of the smaller items
such as the fuel and lube trucks. Apollo believes that the remainder of the equipment listed will be
available for the Black Fox project.

Table 22.2 Montana Tunnels Mine Equipment

ID Year Manufacturer Model Machine Type Hours
B12 1993 Caterpillar D11N Crawler Tractor 39,049
B01 1990 Caterpillar D8N Crawler Tractor 40,095
S03 1996 Caterpillar 5230 Front Shovel 42,579
S04 1996 Caterpillar 5230 Front Shovel 37,662
D06 2004 Ingersoll-Rand CM780D Hydraulic Drill 2,701
D01 1991 Ingersoll-Rand DM45E Blasthole Drill 43,552
D05 1994 Ingersoll-Rand DM45E Blasthole Drill 8,842
A12 1989 Caterpillar IT28B Intergrated Tool Carrier 8,179
Z07 1997 Caterpillar IT28G Intergrated Tool Carrier 4,640
G01 1991 Caterpillar 16G Motor Grader 61,659
G03 1993 Caterpillar 16G Motor Grader 60,642
T18 1995 Caterpillar 785B Rock Truck 62,403
T19 1995 Caterpillar 785B Rock Truck 65,663
T26 1989 Caterpillar 785 Rock Truck 47,285
T10 1993 Caterpillar 777C Rock Truck 61,674
T20 1993 Caterpillar 777C Rock Truck 53,835
W03 1976 Caterpillar 773 Water Truck 18,458
W04 1984 Caterpillar 769C Water Truck 26,807
L06 1991 Caterpillar 992C Wheel Loader 63,191
L03 1991 Caterpillar 992C Wheel Loader 64,279
A13 1988 John Deere 310C Wheel Loader 10,858
A07 1982 Caterpillar 950B Wheel Loader 14,280
Z01 1989 Michigan L140 Wheel Loader 4,527
A06 1979 Caterpillar 235 Hydraulic Excavator 21,501
L35 2000 Caterpillar 325B Hydraulic Excavator 15,093
A29 2003 Caterpillar 232 Skid Steer Loader 1,302
A23 1993 Bobcat 743B Skid Steer Loader 2,472
A04 1972 Grove RT65S Rough Terrain Crane 6,140
A16 1987 Manitou T604TC Rough Terrain Forklift 14,666
A17 1988 Sellick SD100 Rough Terrain Forklift 5,470
A05 1987 Lift All L60 Forklift Attachment 2,293
A07A 1982 Caterpillar Forklift Attachment
A23B 1993 Bobcat Fork Attachment
A24 1984 Caterpillar V180B Forklift 8,188
A08 1981 Ford F700 Power Wash Truck 74,447
A09 1982 Ford F700 Mechanics Truck 4,242
A28 1995 Ford LN9000 Mechanics Truck 4,242
W01 1978 GMC 6000 Service/Drill Truck
ME10 1993 Ford F350 Welding Truck
ME21 1989 GMC 3500 Welding Truck
ME B0M 1978 Ford LT800 Boom Truck
A14 1985 Kenworth W900B Fuel & Lube Truck 3,660
A22 1987 Kenworth T800 Fuel & Lube Truck 13,493
A26 1984 Ford LT8000 Fuel & Lube Truck 3,366
L21 1994 Ford LNT8000 Fuel Truck
C04 1993 Ford F350 Flatbed Truck
A18 1986 Chevrolet C30 Flatbet Truck
ME03 1995 Chevrolet 2500 Flatbed Truck
ME05 1995 GMC 3500 Flatbed Truck
A15 1979 Kenworth W900 Dump Truck 10,125
A25 1979 GMC 7000 Plow/Sander Truck
W02 1971 Kenworth W925 Sander Truck 8,931
C03 1986 GMC BRIGADI Sander Truck 7,103
ME07 1992 Ford F250 Utility Truck
ME08 1978 Dodge TRADES Ambulance
P35 1981 Caterpillar 3306 Generator Set 639
Q02 1985 Allmand MAXI Light Tower
Q03 1985 Allmand MAXI Light Tower 300
Q04 1985 Allmand MAXI Light Tower 8,637
Q06 1987 Allmand MAXI Light Tower 987
Q11 2003 Terex AL5080D Light Tower 7,355
Q12 2003 Terex AL5080D Light Tower 8,335
Q13 2000 Allmand NIGHT Light Tower 3,811
Q14 1998 Wacker LT4Z Light Tower 7,253
Computer 2003- 15 Dell
Computer 3 Compaq
Network 2003 Novell
Trimble 2002 5700 GPS
Trimble 2005 S6 Total Station
2-way radios on all large equip.

Other mine equipment and facilities will be purchased new. New mining equipment includes a mass
excavator and 3 trucks purchased in years 2 and 3 of the operation. In addition, one hydraulic drill is
leases, starting in year 1. Mining can be divided into three distinct areas:
Glacial Till
Waste mining away from mineralization
Ore and waste mining near mineralization
22.3.1 Glacial Till
This study assumed the alluvial (overburden) mining will be completed with a truck-shovel
combination. Typically a 15-18 m3 front shovel will load trucks with alluvium from 6 m pit benches.
Drill and blasting has not been assumed to be required for the overburden materials. The overburden
waste pile will be located across Highway 101 north of the pit, as shown in the Figure 22.1 site plan map
and areas for topsoil, clay and sand alluvial materials will be accommodated. Contract mining and use
of scrapers for mining overburden should be considered before finalizing plans for the project.

22.3.2 Waste Mining Away From Mineralized Areas
In areas known to contain only waste materials the drill hole spacing and bench interval can be different
than in the mineralized area. About 25% of the waste rock mined will be from areas that do not contain
gold mineralization. Blastholes 165 mm in diameter will be drilled on a 5 x 5 m staggered pattern for a
6 m bench. A powder factor of .25 kg/t was used for blasting with 1.5 m of sub-grade drilling. ANFO
will be used for about 80% of the blasting along with an assumed 20% wet holes requiring emulsion to
be used. Buffer blasting and pre-splitting along final pit walls will be used to allow steeper pit slopes.
Blasted rock will be mined by a 15-18 m3 front shovel. The waste rock disposal site is located east of
the mine as shown in Figure 22.1.
22.3.3 Mining in the Mineralized Areas
The mineralized zones average 4.75 m wide, but can be as narrow as one meter. Blastholes 102 mm in
diameter will be drilled on a 3.25 m staggered pattern on 6 m benches, however, mining will be
completed on 3 m intervals. Material will be blasted, generally using ANFO and a powder factor of
0.25 kg/t. Mining in the mineralized area will generally be accomplished using a 10.5 m3 mass
excavator with a bucket designed for narrow mining. The bucket should be designed to be about 2.5 m
wide vs the normal bucket width of 2.85 m. For narrow zones, a 4 m3 mass excavator equipped with
narrow (1.2 m wide) and normal (2.0 m wide) buckets will be used. Ore and waste material will be
trucked using 100 tonne trucks.
The waste mined from inside the ankerite alteration zone may have concentration of arsenic and nickel
that according to preliminary waste characterization completed by AMEC may require special handling.
This material is expected to total about 12% of the waste from the pit. This material will need to be
segregated and may require additional handling or water treatment during closure. More work is
required to adequately determine closure impacts.
22.4 Mine Productivity
22.4.1 Drilling and Blasting
The design assumptions used to determine drilling and blasting productivity are shown in Table 22.3 and
Table 22.3a.

Table 22.3 Drill and Blasting Assumptions (1)

Ore Ore Waste Waste Wall Control Pattern
Units Bedrock Bedrock Bedrock Bedrock Buffer Preshear
Tonnage Factor dmt/cubic metre 2.780 2.780 2.850 2.850 2.850 2.850
Blast Pattern Details
Bench Height metres 6.00 6.00 6.00 6.00 6.00 12.00
Sub Drill metres 1.30 1.30 1.30 1.30 1.30 0.00
Diameter of Hole mm 102.00 165.00 102.00 165.00 165.00 102.00
Staggered Pattern Spacing metres 3.25 5.00 3.25 5.00 5.00 2.00
Staggered Pattern Burden metres 3.25 5.00 3.25 5.00 5.00 2.00
Drill Equivalent Square Pattern metres 3.25 5.00 3.25 5.00 5.00 2.00
Hole Depth metres 7.30 7.50 7.30 7.30 7.30 12.00
Height of Stemming or Unloaded Length metres 0.73 1.55 0.56 1.20 2.42 9.96
Material Quantity
Volume Blasted/Hole cubic metres 63 150 63 150 150 48
Tonnes Blasted/Hole tonnes 176 417 181 428 428 137
Typical Powder Factor with Ammonium Nitrate Explosive
Density of Powder g/cc 0.82 0.82 0.82 0.82 0.82 0.82
Loading Density kg/m 6.70 17.53 6.70 17.53 17.53 6.70
Powder/hole kg 44.05 104.25 45.15 106.88 85.50 13.68
Powder Factor kg/t 0.250 0.250 0.250 0.250 0.200 0.100
Powder Factor kg/bcm 0.695 0.695 0.713 0.713 0.570 0.285
Drill Productivities
Penetration Rate
M/min
M/hr 40.00 40.00 40.00 40.00 40.00 30.00
Penetration Rate - used for this calculation M/min 0.67 0.67 0.67 0.67 0.67 0.50
Cycle Time Estimate
Drilling Time minutes 10.95 11.25 10.95 10.95 10.95 24.00
Steel Handling Time minutes 0.20 0.20 0.20 0.20 0.20 1.00
Set up Time minutes 0.80 0.80 0.80 0.80 0.80 1.00
Add Steel minutes
Pull Rods minutes
Total minutes 11.95 12.25 11.95 11.95 11.95 26.00

Table 22.3a Drill and Blasting Assumptions (2)
Drill Productivities Ore Ore Waste Waste Wall Control Pattern

Schedule Data Material Type Bedrock Bedrock Bedrock Bedrock Buffer Preshear
Calendar Days days/year 365 365 365 365 365 365
Scheduled Shutdown days/year
Unscheduled Days Down days/year 22 22 22 22 22 22
Mine Work Days days/year 343 343 343 343 343 343
Work Days / Week days/year 7 7 7 7 7 7
Shifts / Day shifts/day 3 3 3 3 3 3
Shifts / Week shifts/week 21 21 21 21 21 21
Scheduled Weeks / Year weeks/year 49 49 49 49 49 49
Shifts / Year shifts/year 1029 1029 1029 1029 1029 1029
Scheduled Hours / Shift hours/shift 8 8 8 8 8 8
Scheduled Hours / Year hours/year 8,232 8,232 8,232 8,232 8,232 8,232
(T) Total Theoretical hours/year 8,760 8,760 8,760 8,760 8,760 8,760
(SU) Scheduled & Unscheduled Shutdown hours/year 528 528 528 528 528 528
Standby
Lunch Break hours/shift 0.50 0.50 0.50 0.50 0.50 0.50
Shift Start / Shutdown hours/shift 0.40 0.40 0.40 0.40 0.40 0.40
Coffee Breaks hours/shift 0.20 0.20 0.20 0.20 0.20 0.20
Miscellaneous - Blasting & Moves hours/shift 0.20 0.20 0.20 0.20 0.20 0.20
Total Standby hours/shift 1.3 1.3 1.3 1.3 1.3 1.3
(S) Total Standby hours/year 1,338 1,338 1,338 1,338 1,338 1,338
Available Working Hours hours/day 20.1 20.1 20.1 20.1 20.1 20.1
Available Working Hours hours/year 6,894 6,894 6,894 6,894 6,894 6,894
Annual Hours
(T) Total Theoretical hours/year 8,760 8,760 8,760 8,760 8,760 8,760
(S) Total Standby hours/year 1,338 1,338 1,338 1,338 1,338 1,338
(SU) Scheduled & Unscheduled Shutdown hours/year 528 528 528 528 528 528
(W)+(R) Work + Repair = (T-S-SU) hours/year 6,894 6,894 6,894 6,894 6,894 6,894
(W) Work = MA x (T-S-SU) hours/year 5,860 5,515 5,860 5,515 5,515 5,515
Mechanical Availability Definition
Scheduled Downtime shifts/year 51.45 51.45 51.45 51.45 51.45 51.45
Scheduled Downtime hours/year 411.6 411.6 411.6 411.6 411.6 411.6
Scheduled Downtime % 5.0% 5.0% 5.0% 5.0% 5.0% 5.0%
Unscheduled Downtime % 10.0% 15.0% 10.0% 15.0% 15.0% 15.0%
Total Downtime % 15.0% 20.0% 15.0% 20.0% 20.0% 20.0%
Shifts Available for Scheduling shifts 978 978 978 978 978 978
(MA) Mechanical Availability % 85.0% 80.0% 85.0% 80.0% 80.0% 80.0%
Physical Availability
(PA) Physical Availability = (W+S)/T 82.2% 78.2% 82.2% 78.2% 78.2% 78.2%
Use of Availability
(UA) Use of Availability = W/(W+S) 81.4% 80.5% 81.4% 80.5% 80.5% 80.5%
Effective Utilization
(EU) Effective Utilization = PA x UA 66.9% 63.0% 66.9% 63.0% 63.0% 63.0%
Annual Production
Work Hours / Year hours/year 5,860 5,515 5,860 5,515 5,515 5,515
Operating Efficiency - operation based % 85.0% 85.0% 85.0% 85.0% 85.0% 85.0%
Production Hours / Year hours/year 4,981 4,688 4,981 4,688 4,688 4,688
Scheduled Shifts / Year (from below) shifts/year 978 978 978 978 978 978
Work Shifts/Year shifts/year 733 689 733 689 689 689
Work Hours / Shift hrs 6.7 6.7 6.7 6.7 6.7 6.7
Drilling Hours per Shift drill hrs/shift 5.7 5.7 5.7 5.7 5.7 5.7
Drilling Minutes per Shift drill min/shift 341.7 341.7 341.7 341.7 341.7 341.7
Drilling Minutes per hole drill min/hole 12.0 12.3 12.0 12.0 12.0 26.0
Holes drilled per Shift holes/shift 28.6 27.9 28.6 28.6 28.6 13.1
Metres Drilled per Shift m/shift 208.74 209.20 208.74 208.74 208.74 157.71
Tonnes Drilled per Shift t/shift 5,038 11,632 5,165 12,224 12,224 1,798
Tonnes Drilled per Year (t x 1000) 3,690 8,019 3,783 8,428 8,428 1,240
Production / Scheduled Work Hours tonnes/hr 629.7 1,454.0 645.6 1,528.0 1,528.0 224.7
Production / Scheduled Production Hours tonnes/hr 740.9 1,710.6 759.5 1,797.6 1,797.6 264.4

22.4.2 Loading Productivity
The design assumptions used to determine loading productivity, including feeding the crusher, are
shown in Table 22.4.
Table 22.4 Black Fox Loading Productivity
16.5 CM Shovel 16.5 CM Shovel 10.5 cm excavator 11.5 cm Loader
Waste Ore Overburden Overburden Overburden Rock Waste Ore
Schedule Data 150 tonne 150 tonne 150 tonne 100 tonne 100 tonne 100 tonne 100 tonne 100 tonne
Calendar Days days/year 365 365 365 365 365 365 365 365
Scheduled Shutdown days/year
Unscheduled Days Down - weather days/year 15 15 15 15 15 15 15 15
Mine Work Days days/year 350 350 350 350 350 350 350 350
Work Days / Week days/year 7 7 7 7 7 7 7 7
Shifts / Day shifts/day 3 3 3 3 3 3 3 3
Shifts / Week shifts/week 21 21 21 21 21 21 21 21
Scheduled Weeks / Year weeks/year 50 50 50 50 50 50 50 50
Shifts / Year shifts/year 1050 1050 1050 1050 1050 1050 1050 1050
Scheduled Hours / Shift hours/shift 8 8 8 8 8 8 8 8
Scheduled Hours / Year hours/year 8,400 8,400 8,400 8,400 8,400 8,400 8,400 8,400
(T) Total Theoretical hours/year 8,760 8,760 8,760 8,760 8,760 8,760 8,760 8,760
(SU) Scheduled & Unscheduled Shutdown hours/year 360 360 360 360 360 360 360 360
Standby Lunch Break hours/shift 0.50 0.50 0.50 0.50 0.50 0.50 0.50 0.50
Shift Start / Shutdown hours/shift 0.40 0.40 0.40 0.40 0.40 0.40 0.40 0.40
Coffee Breaks hours/shift 0.33 0.33 0.33 0.33 0.33 0.33 0.33 0.33
Miscellaneous - Blasting & Moves hours/shift
Total Standby hours/shift 1.2 1.2 1.2 1.2 1.2 1.2 1.2 1.2
(S) Total Standby hours/year 1,292 1,292 1,292 1,292 1,292 1,292 1,292 1,292
Available Working Hours hours/day 20.3 20.3 20.3 20.3 20.3 20.3 20.3 20.3
Available Working Hours hours/year 7,109 7,109 7,109 7,109 7,109 7,109 7,109 7,109
Annual Hours
(T) Total Theoretical hours/year 8,760 8,760 8,760 8,760 8,760 8,760 8,760 8,760
(SU) Scheduled & Unscheduled Shutdown hours/year 360 360 360 360 360 360 360 360
(S) Total Standby hours/year 1,292 1,292 1,292 1,292 1,292 1,292 1,292 1,292
(W)+(R) Work + Repair = (T-S-SU) hours/year 7,109 7,109 7,109 7,109 7,109 7,109 7,109 7,109
(W) Work = MA x (T-S-SU) hours/year 5,829 5,829 5,829 5,829 5,829 5,829 5,687 5,687
Mechanical Availability
Scheduled Downtime shifts/year 84 84 84 84 84 84 105 105
Scheduled Downtime hours/year 672 672 672 672 672 672 840 840
Scheduled Downtime 8.0% 8.0% 8.0% 8.0% 8.0% 8.0% 10.0% 10.0%
Unscheduled Downtime 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0% 10.0%
Total Downtime 18.0% 18.0% 18.0% 18.0% 18.0% 18.0% 20.0% 20.0%
Shifts Available for Scheduling shifts 966 966 966 966 966 966 945 945
(MA) Mechanical Availability 82.0% 82.0% 82.0% 82.0% 82.0% 82.0% 80.0% 80.0%
(PA) Physical Availability = (W+S)/T 81.3% 81.3% 81.3% 81.3% 81.3% 81.3% 79.7% 79.7%
(UA) Use of Availability = W/(W+S) 81.9% 81.9% 81.9% 81.9% 81.9% 81.9% 81.5% 81.5%
(EU) Effective Utilization = PA x UA 66.5% 66.5% 66.5% 66.5% 66.5% 66.5% 64.9% 64.9%
Annual Production
(WH) Work Hours / Year hours/year 5,829 5,829 5,829 5,829 5,829 5,829 5,687 5,687
Operating Efficiency - operation based 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0% 90.0%
(PH) Production Hours / Year hours/year 5,246 5,246 5,246 5,246 5,246 5,246 5,118 5,118
(BC) Bucket Capacity (heaped) cm 16.50 16.50 16.50 16.50 10.50 10.50 11.50 11.50
(MW) Material Weight kg/bcm dry 2850 2780 2000 2000 2000 2850 2850 2780
MWW Material Weight Wet kg/bcm wet 2900 2830 2300 2300 2300 2900 2900 2830
(BF) Bulk Factor (Swell Factor) 1.35 1.35 1.15 1.15 1.15 1.35 1.35 1.35
(MW1) Material Weight = MW / BF kg/lcm dry 2,111.1 2,059.3 1,739.1 1,739.1 1,739.1 2,111.1 2,111.1 2,059.3
(M) Moisture 5.00% 5.00% 30.00% 30.00% 30.00% 5.00% 5.00% 5.00%
(FF) Fill Factor 0.89 0.89 0.85 0.85 0.85 0.85 0.75 0.75
(EBC) Effective Bucket Capacity = FF x BC cm 14.69 14.69 14.03 14.03 8.93 8.93 8.63 8.63
(MW2) Material Weight = MW1 / (1-M) wmt/lcm 2.15 2.10 2.00 2.00 2.00 2.15 2.15 2.10
Material Weight = MW2 x (1-M) dmt/lcm 2.11 2.06 1.74 1.74 1.74 2.11 2.11 2.06
(TP) Tonnes/Pass wmt 31.55 30.78 28.05 28.05 17.85 19.17 18.53 18.08
(TC1) Truck Size Capacity cubic m heaped 78.0 78.0 78.0 78.0 60.1 60.1 60.1 60.1
(TC2) Truck Size Capacity wmt 150.0 150.0 150.0 150.0 100.0 100.0 100.0 100.0
(TPV) Theoretical Passes = TC1/ EBC passes 5.31 5.31 5.56 5.56 6.73 6.73 6.97 6.97
(TPT) Theoretical Passes = TC2 / TP passes 4.76 4.87 5.35 5.35 5.60 5.22 5.40 5.53
(AP) Actual Passes = ROUND TPT passes 5.0 5.0 6.0 6.0 6.0 6.0 5.0 5.0
(TL) Truck Load - Volume = AP x EBC cm 73.4 73.4 84.2 84.2 53.6 53.6 43.1 43.1
(TLS) Truck Load for Simulation = AP x TP wmt 157.7 153.9 168.3 168.3 107.1 115.0 92.6 90.4
(TLP) Truck Load for Productivity dmt 149.8 146.2 117.8 117.8 75.0 109.3 88.0 85.9
(TCU) Truck Capacity Utilized = TLS / TC2 by weight 105.2% 102.6% 112.2% 112.2% 107.1% 115.0% 92.6% 90.4%
Truck Capacity Utilized = TL / TC1 by volume 94.1% 94.1% 107.9% 107.9% 89.1% 89.1% 71.8% 71.8%
(AC) Average Cycle Time sec 35 35 35 35 35 35 45 45
(ST) Truck Spot Time sec 24 24 24 24 24 24 24 24
(LT) Load Time per Truck = AP x AC + ST sec 199 199 234 234 234 234 249 249
(LT) Load Time per Truck = AP x AC + ST minutes 3.32 3.32 3.90 3.90 3.90 3.90 4.15 4.15
(MP) Maximum Productivity = 60 / LT trucks/hr 18.1 18.1 15.4 15.4 15.4 15.4 14.5 14.5
Conversion = MP x TLP/ MW bcm/hr 983.9 983.9 1,125.8 1,125.8 716.4 610.3 461.8 461.8
lcm/hr 1,912.5 1,912.5 948.0 948.0 619.3 619.3 619.3 619.3
(TPHM) tonnes/hr 2,710.7 2,645.3 1,812.5 1,812.5 1,153.4 1,681.3 1,272.4 1,241.7
(SS) Scheduled Shifts / Year (from above) shifts/year 966 966 966 966 966 966 945 945
(PH) Production Hours / Year (from above) hrs 5,246 5,246 5,246 5,246 5,246 5,246 5,118 5,118
(TA) Truck Availability to Shovel % 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0% 95.0%
(TPHA) Production Adjusted = TPHM x TA tonnes/hr 2,575 2,513 1,722 1,722 1,096 1,597 1,209 1,180
(RP) Real Production = TPHA x PH tonnes/year 13,509,496 13,183,405 9,032,890 9,032,890 5,748,203 8,378,994 6,186,630 6,037,298
Production / Scheduled Shift = RP / SS tonnes/shift 13,985 13,647 9,351 9,351 5,951 8,674 6,547 6,389
Production / Scheduled Work Hours = RP / WH tonnes/hr 2,318 2,262 1,550 1,550 986 1,437 1,088 1,062
Production / Scheduled Production Hours = RP / PH tonnes/hr 2,575 2,513 1,722 1,722 1,096 1,597 1,209 1,180

22.4.3 Truck Productivity
The design assumptions used to determine hauling productivity are shown in Table 22.5. Both 100 and
150 tonne trucks are planned to be used. Estimated truck productivity is shown in Table 22.6.
Table 22.5 Black Fox Hauling Parameters

Waste Ore Overburden Overburden Rock
Schedule Data 150 tonne 150 tonne 150 tonne 100 tonne 100 tonne
Calendar Days days/year 365 365 365 365 365
Scheduled Shutdown - weather days/year
Unscheduled Days Down - weather days/year 15 15 15 15 15
Mine Work Days days/year 350 350 350 350 350
Work Days / Week days/year 7 7 7 7 7
Shifts / Day shifts/day 3 3 3 3 3
Shifts / Week shifts/week 21 21 21 21 21
Scheduled Weeks / Year weeks/year 50 50 50 50 50
Shifts / Year shifts/year 1050 1050 1050 1050 1050
Scheduled Hours / Shift hours/shift 8 8 8 8 8
Scheduled Hours / Year hours/year 8,400 8,400 8,400 8,400 8,400
(T) Total Theoretical hours/year 8,760 8,760 8,760 8,760 8,760
(SU) Scheduled & Unscheduled Shutdown hours/year 360 360 360 360 360
Standby
Lunch Break hours/shift 0.5 0.5 0.5 0.5 0.5
Shift Start / Shutdown hours/shift 0.4 0.4 0.4 0.4 0.4
Coffee Breaks hours/shift 0.3 0.3 0.3 0.3 0.3
Miscellaneous - Blasting & Moves hours/shift
Total Standby hours/shift 1.2 1.2 1.2 1.2 1.2
(S) Total Standby hours/year 1,292 1,292 1,292 1,292 1,292
Available Working Hours hours/day 20.3 20.3 20.3 20.3 20.3
Available Working Hours hours/year 7,109 7,109 7,109 7,109 7,109
Annual Hours
(T) Total Theoretical hours/year 8,760 8,760 8,760 8,760 8,760
(S) Total Standby hours/year 360 360 360 360 360
(SU) Scheduled & Unscheduled Shutdown hours/year 1,292 1,292 1,292 1,292 1,292
(W)+(R) Work + Repair = (T-S-SU) hours/year 7,109 7,109 7,109 7,109 7,109
(W) Work = MA x (T-S-SU) hours/year 5,829 5,829 5,829 5,829 5,829
Mechanical Availability
Scheduled Downtime shifts/year 84 84 84 84 84
Scheduled Downtime hours/year 1008 1008 1008 1008 1008
Scheduled Downtime 8.0% 8.0% 8.0% 8.0% 8.0%
Unscheduled Downtime 10.0% 10.0% 10.0% 10.0% 10.0%
Total Downtime 18.0% 18.0% 18.0% 18.0% 18.0%
Shifts Available for Scheduling shifts 966 966 966 966 966
(MA) Mechanical Availability 82.0% 82.0% 82.0% 82.0% 82.0%
Physical Availability
(PA) Physical Availability = (W+S)/T 81.3% 81.3% 81.3% 81.3% 81.3%
Use of Availability
(UA) Use of Availability = W/(W+S) 81.9% 81.9% 81.9% 81.9% 81.9%
Effective Utilization
(EU) Effective Utilization = PA x UA 66.5% 66.5% 66.5% 66.5% 66.5%
(WH) Work Hours / Year hours/year 5,829 5,829 5,829 5,829 5,829
Operating Efficiency - operation based 95.0% 95.0% 95.0% 95.0% 95.0%
(PH) Production Hours / Year hours/year 5,538 5,538 5,538 5,538 5,538

Table 22.6 Estimated Truck Productivity

units -1 1 2 3 4 5 6
Haul Cycles
Overburden minutes 13.00 14.00 14.00 15.00 15.00 15.00 15.00
Open Pit Ore minutes 13.00 15.00 17.00 15.00 16.00 17.00
minutes
Stockpile minutes 13.00 2.00
Waste minutes 15.00 16.00 17.00 15.00 16.00 17.00 19.00
Tailings Waste minutes 17.00 17.00 19.00 17.00 18.00 19.00 21.00
Quantities
Overburden (t X 1000) 5,353.5 259.3 3,892.5 200.6 0.0 0.0 0.0
Underground Ore (t X 1000) 0 0 0.0 0.0 0.0 0.0 0.0
Open Pit Ore (t X 1000) 0 436.2 540.0 540.0 540.0 540.0 362.7
Ore To Stockpile (t X 1000) 103.8
Ore From Stockpile (t X 1000) 103.8
Waste - Large Shovel (t X 1000) 2,323.2 7,754.3 5,267.6 6,636.3 6,911.5 3,109.6 1,769.9
Waste - Small Shovel (t X 1000) 258.1 861.6 585.3 737.4 767.9 345.5 196.7
(t X 1000)
Total (t X 1000) 8,038.5 9,415.3 10,285.3 8,114.2 8,219.4 3,995.1 2,329.3
150 Ton Trucks (t X 1000) 7,676.6 8,013.7 9,160.0 6,836.9 6,911.5 3,109.6 1,769.9
100 Ton Trucks (t X 1000) 361.9 1,401.6 1,125.3 1,277.4 1,307.9 885.5 559.4
Contract Mine (t X 1000) 0.0 0.0 0.0 0.0 0.0 0.0 0.0
Loading Distribution
Ore
16 CM Shovel (t X 1000) 103.8 436.2 540.0 540.0 540.0 540.0 362.7
10.5 CM Excavator (t X 1000) 0.0
18 CM FEL (t X 1000) 0.0 0.0 0.0 0.0 0.0 0.0
11.5 CM FEL (t X 1000) 103.8 0.0 0.0 0.0 0.0 0.0
(t X 1000) 0.0 0.0 0.0 0.0 0.0
Total (t X 1000) 103.8 540.0 540.0 540.0 540.0 540.0 362.7

Waste
16 CM Shovel (t X 1000) 2,323.2 7,754.3 5,267.6 6,636.3 6,911.5 3,109.6 1,769.9
11.5 CM FEL (t X 1000) 258.1 861.6 585.3 737.4 767.9 345.5 196.7
16 CM Shovel - Overburden (t X 1000) 5,353.5 259.3 3,892.5 200.6 0.0 0.0 0.0
18 CM FEL (t X 1000) 0.0 0.0 0.0 0.0 0.0 0.0
Total (t X 1000) 7,934.8 8,875.3 9,745.3 7,574.2 7,679.4 3,455.1 1,966.5
22.5 Processing
Two options are considered for processing:
Owner Milling Case (Base Case)

Toll Milling Case
The base case assumes that ore mined will be processed on-site by a new mill with a rated capacity of
540,000 tonnes per year. The toll mill case assumes that the ore will be processed by an existing mill
near the project on a cost per tonne basis.
Most of the processing section was developed by Peter Taggart & Associates who prepared the
metallurgy and processing sections of the 2004 pre-feasibility study. Peter Taggart is a registered
Professional Engineer in the Province of British Columbia. For the purpose of this pre-feasibility study,
the weighted average gold recovery to dore’ metal is projected to be 97%, based on the assumption that
the metallurgical response of the mineralization to be treated will be the same as that experienced to date
in operating plants. The capital and operating estimates for Owner Milling were updated in 2006 by
SRK.
Prior to the commencement of a Feasibility Study, it is essential that representative samples of the
material to be mined be subjected to characterization bottle roll tests, to confirm, or otherwise this
critical assumption.
The Black Fox mineralization is hosted in two zones, the West Zone and the East Zone. The West Zone
material principally comprises green carbonate and contains gold in quartz ankerite-veinlets. Minimal
amounts of sulfide are present. The East Zone contains up to 5% sulfides, principally as pyrite. While
the East Zone mineralization is slightly more refractory than the West Zone material, both exhibit free
milling characteristics and yield gold recoveries in excess of 95%.
The mineralization contains finely disseminated visible gold and is amenable to gravity concentration.
The host rock contains no graphite or cyanide consuming minerals in quantities sufficient to adversely
affect gold recoveries or operating costs.
22.5.1 Owner Milling Option
A variant of the Macassa mill flowsheet, designated Owner Mill, has been adopted as the base case in
the pre-feasibility study.
Process flowsheets have been prepared to the degree of detail deemed appropriate for this pre-feasibility
study. Principal items of process equipment were sized and used to generate conceptual plant layouts.
The layouts are by no means optimized, but simply used to determine approximate building dimensions
and conveyor lengths.
Flowsheets and general arrangement drawings are included in Appendix A. The following plant
description outlines the Owner Mill flowsheet and layout. As in most mills, the crushing and grinding
sections of the plant comprise the most capital intensive cost centers. For the purpose of this pre-
feasibility study, it is assumed that a SAG/ball mill circuit will be used. Alternative arrangements
include:
Single-stage fine crushing, primary ball mill, secondary ball mill;

Two-stage fine crushing, primary ball mill, secondary ball mill; or
Single or two-stage fine crushing with a rod mill and ball mill.
There are examples of the SAG option and each of the alternative circuits in northern Ontario gold
plants. The options offer varying degrees of operating simplicity/complexity, with associated differences
in capital and operating costs. It is beyond the scope of this study to perform detailed economic trade-off
studies to determine the most cost-effective means of comminution. Further, if the SAG option were to
be pursued, any trade-off studies would be premature, pending completion of the first phase of SAG
amenability.
Crushing
Mine trucks will deliver ore to the primary crusher feed hopper, or to stockpiles located in close
proximity to the crusher. The stockpiles will be managed to minimize fluctuations in mill feed grade. A
front-end loader, assigned to, and operated by Mine Department, will reclaim ore from the stockpiles
and charge the crusher feed hopper.
Ore will be withdrawn from the 150 t capacity hopper by means of a 1,168 mm x 4,877 mm (46” x 16’)
vibrating grizzly which will feed material over 50 mm in size to a 914 mm x 1,067 mm (36” x 48”) jaw
crusher. The grizzly undersize product and the crushed ore will fall on to #1 Conveyor, a 914 mm (36”)
covered belt that will transport the material to the 2,300 t live capacity crushed ore bin. The #1
Conveyor will be furnished with a belt scale and a plough to divert crushed ore from the conveyor to the
ground, on the rare occasion when it is required to accumulate stockpiles of crushed ore. A reclaim feed
hopper is provided into which a front-end loader can load crushed ore from the stockpile on to #1
Conveyor.
The steel-framed, metal-clad primary crusher building will be heated and serviced with a wet dust
collector. The slurry so produced will be pumped to the grinding circuit. A 30 t/5 t capacity bridge crane
will facilitate maintenance of the crushing equipment. The primary crushing circuit is designed to crush
175 tph ore to 100 mm. Capacity is available to accommodate potential increases in production rates.
Crushed Ore Storage
Crushed ore will be stored in an insulated, steel cylindrical bin, the design criteria for which are based
on successful and similar installations in the Hemlo camp. Ore will be withdrawn from the bin by three
vari-speed 914 mm x 3,658 mm (3’ x 12’) apron feeders which will discharge on to the SAG mill feed
conveyor. The lower part of the crushed ore storage bin will be enclosed in a metal-clad, steel-framed
and insulated building.
Semi-Autogenous Grinding
A 762 mm wide conveyor belt, #2 Conveyor, will deliver ore to the SAG mill feed chute. The 5,486
mm x 1,981 mm EGL (18’ x 6.5’ EGL), 746 kW (1,000 hp) SAG mill will reduce the size of the mill
feed to a 1,200 mm transfer size. The mill will be steel-lined and furnished with a trommel screen. The
trommel screen undersize will gravitate into a pump-box from which the pulp will be pumped to a
vibrating screen. The screen overflow will discharge into the SAG mill feed chute while the screen
underflow will gravitate to the cyclone feed pump box. (Flowsheet PFD-002 illustrates the alternative
configuration that would be required, should pebble crushing be necessary.)

Lime slurry and sodium cyanide solution will be introduced into the SAG mill feed chute. The grinding
circuit pulp pH will be maintained within the range of 10.5 – 11.0. Sodium cyanide solution will be
added to maintain a free cyanide concentration of 0.5 gpl.
Pebble Crushing
SAG amenability testwork will determine the requirement for a pebble crusher. Should pebble crushing
be required, the trommel screen undersize will feed a double deck, low head, horizontal vibrating screen,
1,219 mm x 2,438 mm (4’ x 8’). The two screen oversize products will discharge on to Conveyor #3, a
762 mm (30”) wide transfer belt, which will feed the 457 mm (18”) wide Conveyor #4. Equipped with
two magnets and a metal detector, this conveyor will feed pebbles at the rate of 24 tph to a 914 mm
(36”) wide shuttle conveyor. Should scrap steel be identified by the metal detector, after the belt charge
has passed beneath the magnet, the shuttle conveyor will withdraw automatically to divert the pebbles
from the pebble crusher feed to the SAG mill feed conveyor. The shuttle conveyor may be reversed and
moved, to allow uncrushed pebbles to be stockpiled outside, when the pebble crusher is out of service.
Under normal circumstances, an extra heavy duty, 914 mm (3’) short head cone crusher will crush the
pebble to a nominal 12 mm size. The cone crusher will discharge directly on to the SAG mill feed
conveyor. It is emphasized that, subject to the results of essential SAG mill amenability tests, there may
be no requirement for this circuit.
Ball Milling
A 3,353 mm x 5,182 mm (11’ x 17’ EGL), 746 kW (1,000 hp) ball mill will operate in closed circuit
with three 381 mm (15”) cyclones, one of which will be retained in standby mode. The mill will be
rubber-lined and equipped with a trommel screen. The circuit is designed to accommodate a 300%
circulating load to produce a K80 150 µm cyclone overflow.
Lime slurry and sodium cyanide solution will be metered into the cyclone feed pump box. The grinding
circuit will be furnished with ancillary equipment, selected to maximize the ease of operation and
minimize operating costs. Thus, a liner handler and bolt removal tool will be provided to minimize
shutdown times for the replacement of SAG mill liners, lifters and grates. A 30 t/5 t overhead crane will
service the grinding section. Ball storage bins for both the 100 mm and 38 mm grinding media will be
provided, each with a capacity of 30 tonnes. The 25 mm regrind balls will be delivered and stored in
metal drums. A ball bucket will be used to feed balls to the respective mills. A small compressor will be
dedicated to grinding mill clutch service.
Trash Screening
A 1,524 mm x 2,436 mm (5’ x 8’) vibrating screen, furnished with a 1 mm slotted urethane deck, will
remove trash from the cyclone overflow stream. The trash, expected to contain ball chips and wood, will
be collected in a trash tote bin. Failure to effectively remove this tramp material will adversely affect the
operation of the gravity concentrator, the CIP carbon retention screens and the strip column.

Gravity Concentration
The trash screen underflow will gravitate to two banks of urethane-lined, double-start spiral
concentrators, each bank comprising twelve concentrators. The spirals will operate continuously to
recover approximately 15% by weight of the feed weight. The spiral tailings will flow by gravity to the
thickener feed box while the spiral concentrate will gravitate to the concentrate regrind feed pump-box.
Centrifugal gravity concentrators were also considered as a means of effecting this gravity concentration
step. However, the low grade of the gravity concentrate, projected to be less than 5 g Au/t, and the high
capital cost of the centrifugal units, favored the use of spiral concentrators that had been successfully
tested in Lakefield’s 1999 pilot plant program.
Gravity Concentrate Grinding
A 149 kW (200 hp) tower mill will grind the gravity concentrate to a nominal K80 40 µm. The mill will
operate in closed circuit with three, 152 mm cyclones. The cyclone overflow product will flow by
gravity to the pre-leach thickener feed tank.
Pre-Leach Thickening
Flocculant will be added to the slurry feeding a 19,800 mm (65’) diameter thickener, which will thicken
the pulp to a 45% pulp density, by weight, in preparation for leaching. The thickener will be constructed
on grade, outside the mill building, with protection from the elements provided over the bridge and
drive.
Thickener underflow pulp will be pumped to the leach circuit while the overflow stream will be pumped
to the carbon columns.
Leaching
Leaching will be accomplished in five 8,500 mm x 9,500 mm (27.9’ x 31.2’) leach tanks, each equipped
with a 37.3 kW (50 hp) agitator. The leach circuit will provide a nominal 18-hour retention time.
The pulp pH will be maintained within the range of 10.5 – 11.0 and sodium cyanide solution will be
added to maintain a free cyanide concentration of 0.5 gpL. Air will be blown into the tanks by one of
two 850 m3/h (500 cfm) blowers; the second unit being on standby duty.
Carbon-in-Pulp Circuit
Reclaim water will be added to the leach circuit tailing to lower the pulp density to 40% solids by
weight, prior to feeding the five 6,000 mm x 6,500 mm (19.7’ x 21.3’) CIP tanks which will provide a
nominal retention time of 5 hours. The tanks, arranged in series, will be equipped with 18.7 kW (25 hp)
agitators.

Carbon will be transferred in counter-current mode, using recessed impeller pumps. A 2 m2 NKM
carbon retention screen, or equivalent, will be installed in each CIP tank to prevent carbon backflow.
Carbon concentrations in the slurry will be within the range 20 –25 g/L. Discharge from the final CIP
tank will pass over a 1,219 mm x 3,042 mm (4’ x 10’) carbon safety screen, the underflow from which
will pass into the final tailings pump-box. The carbon retained in the screen oversize fraction will be
returned to the final CIP tank.
Carbon recovered from the first CIP tank will be pumped to the loaded carbon screen and hence to the
loaded carbon storage bin.
Carbon-in-Column Circuit
Six carbon columns, 2,000 mm x 3,850 mm (6.56’ x 12.6’) will be deployed to adsorb gold from the
thickener overflow stream. Carbon will be advanced in counter-current direction by means of eductors.
The barren solution will flow to the barren solution tank while the carbon will be transferred to the
loaded carbon screen.
Carbon Stripping
The carbon strip circuit is designed to process 2.5 t of carbon per batch in a single 1,500 mm x 3,353
mm (5’ x 11’) insulated strip column, furnished with a 60° conical bottom. The strip solution, at 10 g/L
NaOH and 2 g/L NaCN, will be heated to 140°C through a plate and frame heat exchanger by a 500 kW
boiler. The operating pressure will be 550 kPa (80 psi). The strip vessel will be made from carbon steel
while 304 stainless steel will be used for the carbon screens.
Acid Washing
The FRP acid wash tank will be of similar dimensions to the strip vessel. Washing will be accomplished
using nitric acid, which will be neutralized with sodium hydroxide solution.
Carbon Regeneration
It is proposed that 50% of the carbon will be regenerated in a 609 mm x 6,706 mm (24” x 22’)
horizontal kiln, equipped with heating 90 kW heating elements. Given the nature of the ore, the
regeneration of all the carbon may not be required, but would contribute to the production of carbon
fines.
Electrowinning
Pregnant solution from the strip column will flow through a 2 m3 electrowinning cell from which
precious metal sludge will be recovered on mild steel wool cathodes.

Smelting
The sludge from the electrowinning cell will be dried and charged into an induction furnace to produce
doré metal.
Buildings and Structures
The crusher building and structure surrounding the base of the crushed ore bin will be of “stick-built”
steel construction, metal clad and insulated. The primary crusher motor control center (MCC), to be
assembled in a module off-site, will be located in close proximity to the crusher building. By so doing,
on-site construction costs are minimized and the module will be situated in a relatively dust free
environment.
The mill building will be a pre-engineered, metal clad and insulated structure. The motor control center
(MCC) will be on the ground floor with the offices, washroom, lunchroom, control room and meeting
room all located above. The MCC and other facilities will be pre-assembled in modular form, prior to
shipping.
The conveyors will be constructed off-site in sections to facilitate construction. The assay laboratory
will be located in a separate pre-engineered building. Modular laboratories were considered and found to
be too expensive.
Power Supply
The peak power demands will approximate 4.1 MW. For the purpose of this study, it is assumed that the
existing infrastructure will be adequate to provide power for the plant, and all other load centers on the
mine site. More precise peak demand estimates, produced during the Feasibility Study, should be
compared with on-site capabilities. A 450 kW diesel-electric generator will provide emergency service.
Reagent Supply and Distribution
Sodium cyanide solution, delivered in bulk liquid form, will be stored in a nominal 50,000 L capacity
tank to be provided by the supplier. Cyanide solution will be transferred from this tank to a distribution
tank from which metering pumps will be used to service the various points of application in the
grinding, leach and carbon strip circuits. The sodium cyanide area will be serviced with a dedicated
sump pump.
Sodium hydroxide will also be delivered in bulk form and stored in a 34,000 L tank from which a
metering pump will deliver the reagent to the carbon stripping circuit. Flocculant will be delivered in
bags, which will be manually discharged into a packaged flocculant mixing system. The flocculant will
be diluted in a supply tank prior to delivery to the thickener.
Bulk lime will be pneumatically unloaded from the truck into a 50 t capacity silo, equipped with a vent
filter. A bin activator will facilitate the flow of lime into a packaged slaker unit. Slaked lime will be

distributed to the various points of application through a circulating loop. The lime area will be serviced
with a sump pump.
Nitric acid will be delivered in barrels and stored in a polypropylene mix tank. An injection pump will
transfer the acid into the acid wash column. Lead nitrate will be used, as required, by manually feeding
the reagent from bags in to the CIP circuit.
Copper sulfate and ferric sulfate will both be received in bags and added, in solid form to the water
treatment circuit by means of screw feeders.
Hydrogen peroxide will be received in 1,400 kg totes from which the reagent will be pumped directly
into the water treatment circuit.
The reagent mixing area will be serviced with an exhaust fan and a 3 t capacity overhead crane. Safety
showers/eye wash stations will be installed at appropriate locations.
Water Supply and Distribution
The fresh water supply will likely be from a combination of underground mine pumping, surface supply,
and well supply. About 400 gpm of fresh water is required for the mill operation, with the majority of
water for the operation coming from recirculation of water from the tailings facility. The underground is
currently being pumped at the rate of 100-150 gpm.
Fresh water will be supplied to the insulated fresh water/firewater storage tank. Fresh water will be
distributed to the process, with a portion treated in a packaged chlorinator system, prior to storage in a
potable water tank. Two gland seal water pumps, one in standby service, will withdraw water directly
from the freshwater tank. Two electric and two diesel-powered pumps will afford fire protection.
Water Treatment
Reclaim water will be bled from the system on an intermittent basis to satisfy water balance and process
water quality considerations. Copper sulfate, as a catalyst, will be added to the feed to the first of two
water treatment tanks. Hydrogen peroxide, introduced into the first tank, will destroy all free and metal
complexed cyanides, with the exception of iron cyanide. The cyanides will be converted to cyanates
which slowly hydrolize to form carbon dioxide and ammonium ions. The copper, nickel and zinc metals
form hydroxide precipitates. Since iron cyanide is too stable to be oxidized by hydrogen peroxide, it is
removed by complexing with copper to form copper ferrocyanide. Ferric sulfate is added to the second
water treatment tank to precipitate any arsenic present.
Compressed Air
Two 672 m3/h, 690 kPa (400 cfm, 100 psi) compressors will provide air for general operations and
maintenance purposes. Air taken from the loop will pass through an air dryer for use in instrumentation.

22.5.2 Processing Design Assumptions
Table 22.7 shows the Owner Milling criteria and assumptions.
Table 22.7 Owner Milling Assumptions

Item Units Value
General
Average daily mill throughput tpd 1,500
Operating days per year 360
Annual mill throughput t 540,000
Run-Of-Mine Ore
Feed grade g/t Au 6.5
Specific gravity of dry solids 2.8
Moisture % water 2
Crushing
Primary crushing schedule hrs/shift 12
shifts/week 14
Scheduled operating time h/day 16
Crusher availability % 70
Primary crushing rate tph 145.6
Design factor % 20
Design crushing rate tph 174.7
Type of crusher Jaw
Open side setting mm 100
Size of crusher (36” x 48”) mm 914 x 1,067
Crushed ore live storage capacity t 2,300

Table 22.7 Owner Milling Assumptions – Continued

Item Units Value
Primary Grinding Circuit
Average daily mill feed rate tpd 1,500.00
Plant availability % 92
Plant operating rate tpd 1,630.40
SAG Mill
Feed size, P80 mm 125,000
Transfer size, P80 mm 1,200
Ball mill work index kWh/t 17
SAG efficiency factor 1.8
Mill feed density % solids 72
Pebble recycle percentage, if required % 35
Mill size, 18’ x 6.5’ EGL mm 5,486 x 1,981
Mill power KW 746
Ball size mm 100 (4”)
Ball consumption kg/t 0.45
Reagent addition Lime/cyanide
Ball Mill
Feed size, P80 mm 1,200
Product size, P80 mm 150
Circulating load % 300
Mill size, 11’ x 17’ EGL mm 3,353 x 5,182
Mill power kW 746
Ball size mm 38 (1.5”)
Ball consumption kg/t 0.5
Classification
Cyclones, number 3
Type of cyclone Or equivalent Gmax 15
Cyclones, size mm 381 (15”)
Overflow to gravity separation % solids 22.7
Underflow to ball mill feed % solids 80
Trash De-Grit Screen
Type of screen Vibrating
Screen size mm 1,524 x 1,219
Aperture (slots) in urethane deck mm 1.4


Item Units Value
Gravity Concentration
Type of unit Spirals
Model of unit, or equivalent Carpco MC7000
Continuous or batch operation Continuous
Number of units per bank 12
Number of spiral banks 2
Weight recovery to concentrate % 15
Gravity concentrate to regrind tph 10.2
Gravity tail to thickener tph 57.7
Gravity Concentrate Regrind
Type of mill Tower mill
Feed size, P80 mm 150
Product size, P80 mm 40
Tower mill efficiency factor % 70
Mill power kW 149
Ball size mm 25
Ball consumption, per tonne fresh mill feed kg/t 0.1
Pre-Leach Thickener
Thickener underflow density % solids 45
Feed rate tph 67.9
Thickener diameter, 65’ mm 19,812
Unit area m2/t/d 0.189
Nominal leach time hrs 3.5
Reagent addition Lime/cyanide/floc
Carbon Adsorption
Number of columns 6
Column diameter mm 2,000
Column height mm 3,850
Nominal solution upflow m3/h/m2 10.8
Carbon loading g/t 5,000
Carbon transfer frequency, design t/d 2.5
Leaching
Feed rate tph 67.9
Leach density % solids 45
Leach time h 18
Volumetric allowance for contained air % 15
Number of stages 5
Pulp pH 10.5 – 11.0
Nominal air addition rate m3/h/m3 vol 3
Number of blowers (including 1 standby) 2
Lead nitrate


Item Units Value
Carbon-In-Pulp
Feed rate tph 67.9
Pulp density % solids 40
Retention time h 5
Volumetric allowance for contained air % 15
Number of stages 5
Carbon concentration gpL 20 - 30
Carbon transfer tpd 2.5
Carbon Stripping
Size of batch t 2.5
Strip duration h 12
Strip rate BV/h 2
Strip temperature °C 140
Strip pressure kPa 550
Strip solution
Sodium hydroxide g/L 10
Sodium cyanide g/L 2
Strip frequency per day 1
Boiler type Electric
Boiler capacity kW 500
Heat exchangers Plate and frame
Carbon Acid Washing
Nitric acid solution strength % 3
Sodium hydroxide solution strength % 3
Percentage carbon washing % 100
Cycle time h 10
Carbon Regeneration
Type of equipment Horizontal 90kW Electric
Percentage of carbon regenerated each day % 50
Kiln capacity kg/d 1,500
Carbon attrition Agit. tank
Carbon sizing Vib. screen
Carbon losses kg/t ore 0.07
Electrowinning
Number of cells 1
Cell capacity 3 2
m
Operating temperature °C 80
Cathode Steel wool
Dore Production
Induction furnace kW 75
Tailings Losses
Leach solids g/t Au in solids 0.18
% 2.8
CIP solution loss g/t Au in solution 0.008
% 0.2
Total Loss 3
Gold to Solution by Stage
Primary grinding, concentrate regrinding % 90
Leach / CIP % 7
Total Gold Recovery % 97

22.5.3 Tailings Design
The tailings design for the project was completed by AMEC in their December, 2004 report entitled
“Open Pit Overburden, Waste Stockpiles and Tailings Impoundment Pre-feasibility Study. Excerpts
from their report follow.
For the tailings impoundment, the primary design considerations included the potential for excess
seepage of cyanide contaminated tailings pond water, management of the tailings pond water and the
stability of tailings dams. The stability and settlement of the tailings dam is of concern due to the soft
clay foundation. Since the tailings dams have to be sufficiently high for the required storage capacity, a
ground improvement technique by pre-loading the soft clay with the use of prefabricated vertical drains
(wick drains) has been considered to increase the dam stability and reduce the dam fill quantities.
From the site closure perspective, it was considered that making an allowance for complete or partial
draining of the tailings pond and vegetating the tailings deposit, after the quality of tailings pond water
becomes adequate for direct discharge to the environment, would be adequate.
22.5.3.1 Tailings Dam Design Considerations
Total tailings production: 3 million tonnes.

Tailings properties: SG = 2.8 to 2.95; comprise 20 to 46% sand, 46 to 69% silt, and 8 to 12%
clay.
Long-term stability under static loading conditions: Factor of Safety ≥1.5.
Short-term stability under static loading conditions for the downstream slopes.
Factor of safety ≥1.1 with no strength gain in the silty clay.
Factor of safety ≥1.3 with partial strength gain in the silty clay. (seismic stability will be
addressed at the next design stage)
Buffer zone to the highway: ≥100 m.
Buffer zone to the other property lines: ≥50 m.
Freeboard at the tailings dam: ≥1 m under selected extreme operating (i.e., 100-year spring
runoff volume) conditions.
The proposed tailings disposal facility (referred to as the “tailings impoundment”) would be located
east of the open pit within the East Block. The tailings impoundment will be 1,300 m long from east to
west and about 650 m wide from north to south, with a footprint area of about 84 ha. The dams will be
raised progressively, in three stages during the mine life. A perimeter dam would be constructed on the
silty clay foundation, with a final height of 8 m and a total length of approximately 3,300 m. The storage
of 3 million tonnes of tailings will then require approximately 84 ha footprint. The proposed tailings
perimeter dam would be located approximately 100 m south of the highway and about 50 m from the
south and east property lines. For the stability of the downstream slope of the tailings dam,
prefabricated vertical drains would be installed over a 50 m wide area underneath a stability berm. The
pit water settling pond would be located between the open pit and the tailings impoundment, within the
East Block.

The design principles adopted for the tailings impoundment designs are:
It is expected that the process water discharged with tailings will be contaminated with cyanide
and an elevated level of arsenic. Hence, it will not be suitable for direct discharge (i.e., without
treatment) to the environment. To prevent excessive seepage losses of contaminated water from
the tailings impoundment, the dams forming the impoundment will be low permeability
structures.
The tailings dams will be constructed with locally available materials, including suitable (i.e.,
chemically inert and weathering resistant) rockfill from the open pit development.
The tailings impoundment site has a silty clay foundation. An HDPE liner will be installed as the
low permeability element in the tailings dams and will be connected to the silty clay to provide a
low permeability system.
The slopes of the dams must have adequate safety margins under all stages of construction, pond
levels and operating conditions, consistent with commonly accepted dam safety standards.
The dams will be raised in stages according to storage requirements and the availability of
construction materials.
An operating pond will be developed in the tailings impoundment and maintained/controlled
during the mine operation through appropriate tailings slurry disposal practice.
Tailings pond water will be pumped to the mill for reclaim and treatment for cyanide and arsenic
before the release of excess water to the environment. The treatment will only be carried out in
the months of June to November inclusively.
A minimum 1.0 m freeboard for the pond water level will be provided with respect to the crest of
the perimeter dams under selected extreme operating (i.e., 100 year spring runoff volume)
conditions.
The required capacity of the tailings impoundment has been determined considering the tailings
production schedule and the design criteria. The following design input parameters have been
established relevant to the impoundment storage capacity:
Total tailings tonnage over the mine life is about 3 Mt.

Tailings slurry is pumped at 39.5 % solids content (MDA, 2004).
The dry density of deposited tailings is estimated at 1.32 t/m3 based on a void ratio of 1.2 and a
specific gravity of 2.9. Note that the relatively low tailings deposit, as discussed later, will not
allow for a high degree consolidation of the deposited tailings.
The barge pumping water to the mill will require a minimum operating tailings pond volume of
300,000 m3.
A maximum operating pond volume of 1,000,000 m3 needs be maintained to permit a seasonal
treatment of the tailings water (storage and treatment-discharge for a period of approximately
six months intended to enhance the natural degradation of cyanide).
Sufficient storage capacity will be provided to store up to the 1:100 year spring runoff volume.
A dam freeboard of 1 m will be provided above the emergency spillway invert elevation. Based
on these design input parameters, a storage capacity of about 4Mm3 will be required for the
tailings impoundment. The tailings impoundment will have a watershed area of about 65 ha
(within the dam centrelines), a total footprint area of about 84 ha (defined by the downstream
toes of the dam), and a final dam height of 8 m.
The Stage 1 tailings dams will have a nominal height of 4 m above the existing ground surface and will
have to be constructed before the milling operation starts. The Stage 2 and Stage 3 tailings dams will
have nominal heights of 6 m and 8 m, respectively.
To maximize the storage volume, slurry disposal from internal rockfill fingers will be required during
operations. The fingers will comprise rockfill material with a crest width of about 15 m so they can be
constructed using the mine trucks. Design and locations for these fingers will be determined in
conjunction with the tailings deposition plan at the feasibility design stage.
The dam design accounts for the storage capacity requirements, design criteria, water quality, physical
stability, settlement, seepage as well as operating and economic considerations. The tailings dam
comprises prepared foundations, an upstream high-density polyethylene liner (HDPE) acting as the low
permeability element, granular bedding on both sides of the liner, rockfill embankment and a vertical
drains (wick drains) bed.
The plastic liner extends over the upstream face of the dam and into a toe cut-off trench. The trench,
about 1 m deep, 1.5 m wide and extending along the impoundment perimeter, is required to anchor the
liner using silty clay (low permeability) material (Zone 1) for backfill. This will ensure a low
permeability cut-off thus minimizing the groundwater flow (seepage losses) through the dam.
Foundation preparation will involve the stripping of topsoil/peat and unsuitable materials within the
dam footprint, and will include the installation of prefabricated vertical drains to improve the stability
margin of the dam thus permitting lesser downstream slopes.
The nominal dam crest width is 8 m, with an upstream side slope of 3H:1V designed to facilitate the
installation and the long-term stability of the liner. The liner is 60 mil HDPE membrane textured on
both sides to improve shear strength along the liner-soil interface. The liner is to be installed between
bedding sand zones. The underlying bedding zone may have to be separated from the fine rockfill layer
by geotextile, depending on actual gradations of the available construction materials. A fine rockfill
layer (Zone 4) on the upstream face of the dam is included for slope erosion protection.
The downstream slope of the dam and the schedule of dam raises takes into account the properties of the
foundation soils. The slope geometry has been developed based on the results of the slope stability
analyses (Appendix C) and experience from similar projects. The dam will be raised using the
downstream method of construction.
The tailings dam will be raised in three stages:
Stage 1 involves the construction of a 4 m high dam embankment (height above the original
ground). The downstream face of the dam has an overall slope of 4H:1V with individual (bench)
slopes of 2H:1V and a bench width of 8 m.
For Stage 2, the tailings dam will be raised 2 m to a total height of 6 m. The rockfill
embankment will have an overall downstream slope of 9H:1V with bench widths of 40 m and 8 m
and the bench heights of 4m and 2 m, respectively. Prior to the dam raise, a system of wick
drains will be installed into the silty clay layer in a 50 m wide area next to the downstream toe of
the Stage 1 m dam. Subsequently, a 4 m high pre-load fill will be placed over the footprint of the
wick drains area. On a preliminary basis, the wick drain system will comprise a series of
prefabricated vertical drains with 2 m spacing in a triangular pattern, penetrating through the
silt clay stratum into the underlying silt and sand to a depth of about 12 m below the ground
level. The wick drains will accelerate consolidation of the silty clay stratum. Pre-loading is
anticipated to strengthen the foundation and reduce post-construction settlements of the dam.
At Stage 3, the dams will be raised 2 m again, to the final height of 8 m, and the overall
downstream slope of the dam will be 7H:1V. Prior to fill placement, a testing program will be
carried out to confirm that primary consolidation of the soft clay under the pre-load fill has been
completed and the strength of the foundation soil increased.
It is emphasized that the upstream slope of the dam has to be supported by tailings beach during the
raises for Stages 2 and 3. In this regard, a dam raise can be undertaken only where the tailings surface
beach has been sufficiently formed, approximately to a level of 1 to 2 m below the dam crest.
Dam Stability Considerations
The tailings dam design has been optimized with regard to the required storage capacity of the
impoundment, the available footprint area and the subsurface conditions.
The use of wick drains will be advantageous since it allows for steepening of the downstream slope of
the dam, taking advantage of the accelerated consolidation. The results of the stability analyses led to
design of the tailings dam with a final height of 8 m and the overall dam slopes of 3H:1V and 7H:1V for
the upstream and downstream sides, respectively. The dam would partly be constructed over improved
ground/foundations so that the impoundment footprint and the dam fill requirements are minimized.
In the analyses, both the downstream and upstream slopes were examined for the various construction
stages (i.e., 4 m, 6 m and 8 m high dams). Five scenarios (Cases 1 to 5) were considered:
Case 1: the starter dam with a height of 4 m.

Case 2: the second stage dam a height of 8 m.
Case 3: the final stage dam conservatively assuming “no strength gain” during preloading.
Case 4: the final stage dam assuming a 50% strength gain occurring during pre-loading.
Case 5: the final stage dam assuming a full strength gain occurring during pre-loading.
For the design of the dam to the final height (8 m), it is considered that the factor of safety for the
downstream slope should be equal to or greater than 1.1 for the “no strength gain” (the most
conservative) assumption, and 1.3 for the “50% strength gain”. The analyses carried out for Case 3
indicate that the factor of safety for the proposed 8 m high tailings dam to be constructed on improved
soft ground in stages should have an adequate safety margin consistent with the design criteria
described in this section.

Water Balance
Water balances have been developed for the tailings impoundment based on the average and the 1:100
wet year runoff conditions. The inflow design parameters used for deriving the water balances include:
The watershed area of the tailings impoundment is estimated to be about 65 ha. The runoff
volumes have been estimated on a monthly basis based the average year runoff conditions.
The tailings slurry is pumped at a rate of 1,500 t/d at a solids content of 39.5% by weight, with
an annual production rate of 540,000 t/year.
An assumed rate of treated sewage discharge is 20 m³/day.
Listed below are the outflow parameters that were used to develop the water balance:
Pond evaporation rate of 537 mm/year is based on pan evaporation records from the Amos,
Quebec meteorological station. Pond evaporation volumes have been estimated based on an
assumed pond area of 32.5 ha (equal to 50% of the tailings impoundment area).
Water volume lost to the tailings deposit has been estimated based on average dry density of
deposited tailings of 1.32 t/m3 and 90% saturation (approximate assumptions derived based on
the extent of expected tailings beach in the impoundment and the tailings gradation).
The seepage rate through the perimeter dams has been assumed to be negligible owing to the
lined perimeter dams and the connection to the low permeability silty clay foundation (relevant
seepage modelling would be carried out at the feasibility design stage).
A mill reclaim rate of 1,615 m³/day based on the estimate provided in the MDA report.
The water treatment occurs during the months of June through November (to take advantage of natural
degradation of cyanide in the tailings pond). The water balance model shows that about 376,000 m3 of
tailings water will have to be treated each year (average treatment rate of about 2,100 m3/day based on
seasonal treatment). However, the design treatment rate would be higher to account for wet year runoff
conditions, treatment plant inefficiencies or, perhaps, advantage of a shorter treatment period. The
design treatment rates will have to be further evaluated at the feasibility design stage in conjunction
with the development of the tailings deposition plan (size of the tailings pond and design storage
capacity), specifications for natural cyanide degradation, and other design considerations.
Site Water Management
The water management system has been developed for the mine site on a first approximation basis. As
noted previously, initial results from the geochemical testing program indicate that the potential for
leaching of arsenic at excessive concentrations from some waste rock remains a possibility at this stage.
Therefore, two cases have been examined, with or without arsenic treatment of the waste rock stockpile
runoff. Case 1 is the base case with no treatment and Case 2 involves treatment for arsenic of the runoff
and shallow seepage originating at the waste rock stockpile.

Case 1 involves the treatment of the tailings pond water for cyanide and arsenic at a water treatment
plant located at the mill site, and treatment of the mill site runoff for arsenic. The water management
system comprises:
Surface runoff and groundwater seepage from the pit walls and bottom is directed to the settling
pond for settling out the suspended solids (assumed rate of 1,284 m3/day of which 640 m3/day is
groundwater seepage). Also, the water reporting to the underground workings is routed to the
settling pond via pit for settling out the suspended solids. The water is then discharged to the
Pike River Tributary 2.
Fresh water for the mill originates from Froome Lake at a required rate of 1,063 m3/day (MDA
2004) (assumes 1/3 of water consumption needs to be fresh water).
Surface runoff and seepage at the overburden stockpile is collected at a perimeter ditch, which
discharges, to a settling pond prior to discharging to Pike River Tributary 1.
Surface runoff and seepage at the waste rock stockpile is collected at a settling pond (located at
the north end of the stockpile) prior to discharging to the Pike River Tributary 1. A settling pond
may be also required at the south end of the stockpile depending on the results of the
topographic surveys (to be carried out at the feasibility design stage) due to the flat topography
in this area.
Tailings pond water is pumped to the water treatment plant at the mill site for treatment of the
cyanide and arsenic on a seasonal basis, as discussed previously.
A total of 483,000 m3 of water will be treated and discharged to the environment. The discharge
location will be finalized based on further environmental studies. Three options are currently
considered feasible, including discharges to Pike River Tributary 1, Pike River Tributary 2 or directly to
Pike River via a pipeline.
For Case 2, it is assumed that treatment of the overland runoff and shallow seepage from the waste rock
stockpile will be required due to elevated arsenic concentrations. The water management system for
Case 2 is similar to Case 1 with the following modification:
Overland runoff and shallow seepage at the waste rock stockpile is collected and pumped to the
treatment plant at the mill site for arsenic treatment.
A total of 1,142,000 m3 of water would be treated. As noted above, the discharge location for treated
water has not been finalized.
For Case 2, to prevent contaminated seepage losses to Lawlar Lake and Middle Lake and to provide
containment of the contaminated runoff from the waste rock stockpile, the following arrangement would
be required on a preliminary basis:
A low permeability slurry wall along the west side of the stockpile (along the watershed
boundary) to reduce seepage losses to Lawlar Lake and Middle Lake. The extent of the slurry
wall to the south would be determined based on more detailed field investigations and hydro
geologic study/modeling.

A low permeability dam and slurry wall at the south end to provide containment of the runoff
and reduce seepage losses. A detailed topographic survey will be required to confirm the
viability of this arrangement.
A collection pond and pumping station located in the drainage valley to the north of the stockpile
to provide containment of contaminated water and temporary storage. The collection pond
would provide sufficient storage capacity for the design extreme runoff event. The pumping
station would pump the contaminated runoff and seepage to the water treatment plant for
treatment on a continual basis.
The collection pond would comprise a low permeability dam and slurry wall to reduce seepage
losses.
22.5.3.2 Closure Considerations
The closure assumptions are for the tailings impoundment, the exterior slopes of the tailings dams will
be stabilized, where required, by additional berm construction and/or slope flattening. The horizontal
(benched) rockfill surfaces will be covered with overburden/topsoil and vegetated with the objective of
creating a self-sustaining vegetative cover. The tailings beach will be covered with materials recovered
from the overburden stockpile and vegetated. The tailings pond will be treated until the excess water is
acceptable for direct discharge to the environment, and drained. At that time, a permanent overflow
spillway will be constructed, as required to ensure efficient drainage of runoff and long-term stability of
the dam.
22.5.4 Toll Milling Option
All of the past production from the mine has been processed off-site by others at a set fee per tonne
processed. This option has the advantage of saving on the initial capital for mill and tailings
construction. Apollo has received a quotation from a nearby mill for processing the material.
22.6 Infrastructure
22.6.1 Access
An allowance has been included to develop the initial site access and haul roads. The project is located
just off Highway 101, with the plant site, administration building, and mine shops located 200-300 m
south of the road. It should be noted that the pit is within 100 m of highway 101, which is the desired
distance from the highway in Ontario. The close proximity to the highway may cause the project to
relocate a several hundred meter portion of the highway to stay within this guideline, however other
mines in the district are within 100 m of a highway. In addition, the slope design in the overburden
materials has not been finalized, which when finalized, may position the pit closer or further away from
the highway. This study assumed that the highway would not require relocation.
22.6.2 Power Distribution
Power is currently available to the project site. The lines are adequate to supply the anticipated 4-5 MW
requirement of the project. An allowance has been included for on-site power distribution.
22.6.3 Water Distribution
The make-up water requirement for the base case is about 50 m3/h (about 400 gpm). Most of the water
required for the mill will be reclaimed from the tailings pond (240 m3/h).
22.6.4 Administration Building
A 16 x 24 m administration building has been included.
22.6.5 Truck Shop and Offices
A three-bay truck shop with wash bay and lube bay has been included in the study. The truck shop will
have facilities to store mine equipment parts and contain offices and change room for the maintenance
personnel. A fenced outside storage area is also included. The equipment ready line will be equipped
with electrical plugs. Mine equipment will have hot start engine oil heaters. The shop and warehouse
building will be 24 x 36 m in size.
During the first three years of mining fuel consumption will average around 120,000 liters per week.
Storage for 160,000 liters of diesel fuel has been included as part of the mine shop facilities. Storage for
lube and hydraulic oils has also been included.
22.6.6 Pit Office
A 7 x 12m pit office will contain offices and change area for mine personnel.
22.7 Permitting
Section 4 of this report contains a list of permit requirements for the project.
22.8 Manpower
Table 22.8 summarizes the total labor requirements of the Black Fox operation for the base case
operation. The maximum employment at the operation is 155, which drops in the later years due to
reduction of mining requirements. The process plant employs a total of 35 people so for the off-site
plant operation option, all of these people would not be employed by Apollo except for a mill
superintendent. Tables 22.9 and Table 22.10 show the annual mine hourly and mine salaried staff
manpower respectively. Table 22.11 shows the process plant manpower, while Table 22.12 shows the
administrative manpower.

Table 22.8 Black Fox Manpower – Base Case

Area Year -1 Year 1 Year 2 Year 3 Year 4 Year 5 Year 6
Staff
Mine Operations 7 8 8 8 4 4 4
Mine Engineering 4 4 4 4 3 3 3
Geology and Ore Control 4 4 4 4 4 4 4
Processing 12 12 12 12 12 12
Total Staff 25 40 40 40 34 34 34
Hourly
Mine Operations 35 50 52 52 41 33 21
Geology and Ore Control
Processing 23 23 23 23 23 23
Total Hourly 64 113 115 115 98 87 72
Total 89 153 155 155 132 121 106
Table 22.9 Black Fox Mine Hourly Labor Requirements

Year -1 1 2 3 4 5 6
MINE OPERATIONS
Drill Operators 2 9 9 9 9 6 2
Blasters 1 2 2 2 2 2 2
Blaster Helpers 2 3 3 3 3 2 2
Loader Operators 4 8 8 8 6 4 4
Haul Truck Drivers 14 14 16 16 14 12 4
Dozers Operators 6 8 8 8 4 4 4
Grader Operators 4 4 4 4 2 2 2
Utility Operators 1 1 1 1 1 1 1
Trainee/Spare 1 2 2 2 1 1 1
TOTAL 35 51 53 53 42 34 22
MINE MAINTENANCE
Mechanics 10 13 13 13 12 9 6
Electricians 0 1 1 1 1 1 1
Welders 1 3 3 3 2 2 2
Lt. Veh. Mechanics 3 4 4 4 2 2 2
Apprentice 0 1 1 1 0 0 0
Storemen 1 2 2 2 2 2 2
Servicemen 1 2 2 2 1 1 1
Tireman 0 1 1 1 1 1 1
TOTAL 16 27 27 27 21 18 15
GRAND TOTAL 51 78 80 80 63 52 37

Table 22.10 Black Fox Mine Salaried Staff Labor Requirements

Year -1 1 2 3 4 5 6
MINE OPERATIONS
EX Mine Manager 1 1 1 1 1 1 1
EX Pit Superintendent
D3 General Foreman
B6 Mine Clerk 1 1 1 1 1 1 1
D1 Mine Trainer 1 1 1 1
D2 Drill and Blasting Superintendent 1 1 1 1
D2 Mine Foreman 3 4 4 4 2 2 2
Subtotal Mine Operations 7 8 8 8 4 4 4

MINE MAINTENANCE
EX Maintenance Superintendent 1 1 1 1 1 1 1
D2 Maintenance Foreman
D1 Shop Shift Foreman 2 3 3 3 2 2 2
D1 Planning Engineer 1 1 1 1 1 1
Subtotal Mine Maintenance 3 5 5 5 4 4 4
Total Mine Operations 10 13 13 13 8 8 8

MINE ENGINEERING
EX Chief Mining Engineer 1 1 1 1 1 1 1
D2 Chief Surveyor 1 1 1 1 1 1 1
C4 Sr Mining Engineer 1 1 1 1
C3 Enviromental Engineer 1 1 1 1 1 1 1
Subtotal Engineering 4 4 4 4 3 3 3
GEOLOGY AND GRADE CONTROL

D3 Chief Geologist 1 1 1 1 1 1 1
C3 Ore Control Geologist 1 1 1 1 1 1 1
B3 Sampler 1 1 1 1 1 1 1
B2 Labor 1 1 1 1 1 1 1
Subtotal Geology and Grade Control 4 4 4 4 4 4 4
TOTAL MINE STAFF 18 21 21 21 15 15 15

Table 22.11 Process Plant Manpower (Base Case)

Salaried Staff Number
Plant Superintendent 1
Plant Supervisors 4
Metallurgist 1
Chief Assayer 1
Assayer/Sample Preparation 2
Maintenance Foreman 1
Maintenance Planner 1
Mill Clerk 1
Subtotals Salaried Staff 12
Hourly Employees
Primary Crusherman 3
Grind/Leach/CIP Operator 4
Solution/Reagent/Gold Room Op. 4
Plant Equipment Operator 1
Laborers 5
Mechanics 4
Electrician 1
Instrumentmen 1
Subtotals Hourly Employees 23
Total Processing 35
Table 22.12 Administrative Personnel

-1 1 2 3 4 5 6
Managers
EX General Manager 1 1 1 1 1 1 1
D6 Human Resources Manager 1 1 1 1 1 1 1
D5 Environmental Manager 1 1 1 1 1 1 1
D4 Safety and Loss Control Manager 1 1 1 1 1 1 1
D6 Controller 1 1 1 1 1 1 1
D4 Purchasing Manager 1 1 1 1 1 1 1
D2 Systems Analyst 1 1 1 1 1 1 1
Totals 7 7 7 7 7 7 7
Administrative Staff
D2 Human Resources Assistant 1 1 1 1 1 1 1
B3 Secretary 1 1 1 1 1 1 1
D1 Accountant 1 1 1 1 1 1 1
C1 Accounting Clerks 1 1 1 1 1 1 1
D1 Purchasing Agent 2 2 2 2 2 2 2
B3 Expiditer 1 1 1 1 1 1 1
B6 Security Guard 4 4 4 4 3 3 3
B6 Janitor 2 2 2 2 2 2 2
Totals 13 13 13 13 12 12 12
Total Administrative 20 20 20 20 19 19 19

22.9 Black Fox Capital Cost Estimate
Pre-feasibility level capital costs were estimated for the project. All the costs are shown in $US 1st
quarter 2006 costs and based on an exchange rate of $US 1.00 = $ CDN 0.88. Deemed adequate for pre-
feasibility study purposes, the estimates are within an order-of-accuracy of ±25%. Costs for four cases
have been developed:
Owner Milling - In Owner Milling the ore will be ground to a nominal P80 150 μm and a gravity
concentrate reground to P80 40 μm.
Toll Milling – In the Toll Milling the ore would be contract crushed and shipped to a nearby mill
for processing. This was the case for all historic production.
The basis for the estimate is predicated on:
Preliminary flowsheets and mass balances;

The general arrangement sketches shown in Appendix A;
The initial use of the Montana Tunnels mine equipment, supplemented by purchase of three new
trucks and one mass excavator in years 2 and 3 of the operation;
Budget price quotations for approximately 70% of the plant and mine estimated equipment costs;
and
In-house data.
A single blanket contingency factor of 10% has been applied to all the Direct and Indirect costs, except
for mine equipment where a 5% contingency has been applied to provide for unexpected costs within the
proposed scope of work.
The estimate includes all costs associated with the design and construction of the Black Fox project on-
site infrastructure, mine and process facilities.
The closure costs for the owner milling case were estimated by AMEC, assuming segregation of about
12% of the waste materials would be required and that no extended water treatment would be required.
MDA used the AMEC costs to estimate closure requirements for the toll milling option. Apollo’s cash
bond balance of $675,000 was subtracted from the estimated closure costs.

The estimate includes costs associated with:
The reconditioning and transportation of the following mine equipment from Montana Tunnels
to the Black Fox site;
o 1 hydraulic drill
o 2 rotary blasthole drills
o 1 16 cm shovel and spare bucket
o 1 Cat 992 front end loader
o 1 Cat 773 water truck
o 2 Cat Dozers
o 1 Cat 16 Motor Grader
o 1 3-4 cm mass excavator
o 4 light plants
o 1 Lube truck
o 1 Fuel truck
o 2 mechanics trucks
o 1 forklift
o 1 welding truck
o 1 integrated tool carrier
o 1 rough terrain crane
o 1 lot surveying equipment
o 1 lot misc small equipment
Access road;
Pre-production stripping;
Site preparation;
Power supply (existing);
Power distribution;
Water supply and distribution;
Mine shop and warehouse;
Mine office;
Administration building;
The crusher and mill buildings, including motor control centers, offices, a lunchroom and office
furnishings;
The purchase and installation of process equipment;
The purchase of special tools to facilitate SAG mill reline procedures;
The purchase, furnishing and equipping of an assay laboratory;
Construction of the tailings storage facility;
Tailings pipeline and reclaim water pipelines;
The purchase of a reclaim water system, including power line;
Engineering, procurement and construction management;
Owner’s costs;
The purchase of small vehicles;
Construction indirect expenses;
Freight and taxes;
Reagent and grinding media “first fill” allowances;
The purchase of critical spare parts,

Working capital;
Closure Costs; and
Start-up and commissioning expenses.
The estimate does not include costs associated with:
Highway 101 relocation if required;

Feasibility studies and the required additional metallurgical and geotechnical test programs;
Permitting activities;
and Sunk costs.
The estimated project capital costs are shown in Table 22.13 for Owner Milling and Table 22.14 for the
Toll Milling option. The tables indicate that the Toll Milling option reduces the total capital cost by
$US 44.2 million when compared to Owner Milling Case. The Toll Milling option will result in better
returns than the Owner Milling option, however, MDA believes that serious consideration should be
given to the Owner Milling option as due to sampling issue, more tonnes of ore will likely be processed
than predicted by the model due to the sampling issues.
Table 22.13 Estimated Capital Cost – Owner Milling

Item
Access Road $50,000 $50,000
Water Supply $250,000 $250,000
Process Plant $21,811,204 $50,000 $50,000 $50,000 $50,000 $22,011,204
Tailings $5,483,104 $0 $3,012,779 $3,012,779 $500,000 $12,008,662
Mine Equipment $2,768,250 $238,500 $4,775,000 $5,150,100 $175,000 $13,106,850
Slop Building $1,000,000 $1,000,000
Site Fencing $75,000 $75,000
Closure $2,601,700 $2,601,700
Owners Cost $2,029,432 $2,029,432
EPCM and Indirects $5,446,577 $5,446,577
Contingency $5,934,535 $33,850 $783,778 $821,288 $72,500 $5,000 $260,170 $7,911,121
Totals $54,690,561 $372,350 $8,621,557 $9,034,167 $797,500 $55,000 $2,861,870 $76,433,005

Table 22.14 Estimated Capital Cost – Toll Milling

Item
Access Road $50,000 $50,000
Water Supply $100,000 $100,000
Process Plant $0
Tailings $0
Mine Equipment $2,768,250 $238,500 $4,775,000 $5,150,100 $175,000 $13,106,850
Slop Building $1,000,000 $1,000,000
Site Fencing $75,000 $75,000
Closure $1,054,600 $1,054,600
Owners Cost $2,030,892 $2,030,892
EPCM and Indirects $258,750 $258,750
Contingency $1,017,434 $33,850 $477,500 $515,010 $17,500 $105,460 $2,166,754
Totals $19,583,848 $372,350 $5,252,500 $5,665,110 $192,500 $0 $1,160,060 $32,226,368
Mine Equipment Costs
Mine equipment costs were obtained by soliciting budget price proposals for new equipment, and a
proposal to transport mine equipment from the Montana Tunnels operation, or using in-house data. The
in-house data were largely founded on a recent mine and mill installation in northern Ontario.
Equipment costs were also derived from the Western Mine Engineering database. The estimated cost of
mine equipment is shown in Table 22.15.

Table 22.15 Estimated Mine Equipment Capital Cost

From Equipment Number of
Montana Tunnels Mine Equipment Item Capital Weight (lbs) Truck Loads -1 1 2 3 4 Totals
* Rotary Drill - 251 mm 1 $63,500 $63.5 $63.5 $0.0 $0.0 $0.0 $127.0
* Hydraulic Drill - 165 mm 2 $58,500 $58.5 $175.0 $175.0 $175.0 $175.0 $758.5
* 16 cm Front Shovel 3 $317,500 $317.5 $0.0 $0.0 $0.0 $0.0 $317.5
* Spare 16 cm Bucket 3A $15,000 $15.0 $0.0 $0.0 $0.0 $0.0 $15.0
New 10-12 cm Mass Excavator 4 $1,765,500 401,000 7 $0.0 $0.0 $0.0 $1,765.5 $0.0 $1,765.5
New Spare 10-12 cm Bucket 4A $181,900 40,000 1 $0.0 $0.0 $0.0 $181.9 $0.0 $181.9
* 10-12 cm Front End Loader 6 $72,000 206,300 5 $72.0 $0.0 $0.0 $0.0 $0.0 $72.0
* Spare 10-12 cm Bucket 6a $5,500 20,700 1 $5.5 $0.0 $0.0 $0.0 $0.0 $5.5
* and New 150 t Truck 7 $116,540 $582.7 $0.0 $4,600.0 $2,300.0 $0.0 $7,482.7
* 100 t Truck 7a $63,750 288,600 7 $127.5 $0.0 $0.0 $0.0 $0.0 $127.5
* 10,000 gal water Truck 9 $52,000 113,000 3 $52.0 $0.0 $0.0 $0.0 $0.0 $52.0
* Dozer 350-450 HP 10 $40,500 107,000 3 $40.5 $0.0 $0.0 $0.0 $0.0 $40.5
* Dozer 800-900 HP 11 $60,250 230,000 5 $60.3 $0.0 $0.0 $0.0 $0.0 $60.3
* Grader 16' Blade 14 $29,500 136,000 3 $29.5 $0.0 $0.0 $0.0 $0.0 $29.5
* 4 cm Mass Excavator 15 $39,500 150,200 4 $39.5 $0.0 $0.0 $0.0 $0.0 $39.5
* Light Plant 17 $3,000 $12.0 $0.0 $0.0 $0.0 $0.0 $12.0
New Stemming Truck 18 $90,950 $91.0 $0.0 $0.0 $0.0 $0.0 $91.0
New Low Boy for Drill, Dozer Transport 19 $267,500 $267.5 $0.0 $0.0 $0.0 $0.0 $267.5
* Lube Truck 50 $8,950 $9.0 $0.0 $0.0 $0.0 $0.0 $9.0
* Fuel Truck 51 $6,450 $6.5 $0.0 $0.0 $0.0 $0.0 $6.5
* Mechanics Truck 52 $5,400 $10.8 $0.0 $0.0 $10.8 $0.0 $21.6
New Pickup Trucks 53 $37,450 $599.2 $0.0 $0.0 $599.2 $0.0 $1,198.4
* Welding Truck/Crane 54 $4,000 $4.0 $0.0 $0.0 $0.0 $0.0 $4.0
* 20 T Rough Terrain Crane 55 $30,750 $30.8 $0.0 $0.0 $0.0 $0.0 $30.8
* Skid Loader M1 $4,500 $4.5 $0.0 $0.0 $0.0 $0.0 $4.5
* 200 HP Integrated Tool Carrier 58 $22,500 60,000 $22.5 $0.0 $0.0 $0.0 $0.0 $22.5
* Ambulance and Fire Equipment 61 $20,500 $20.5 $0.0 $0.0 $0.0 $0.0 $20.5
* Flatbed Truck 62 $4,500 $4.5 $0.0 $0.0 $0.0 $0.0 $4.5
New Crew Vans 63 $53,500 $107.0 $0.0 $0.0 $107.0 $0.0 $214.0
* Forklift M2 $4,000 $4.0 $0.0 $0.0 $0.0 $0.0 $4.0
New ATV M3 $5,350 $10.7 $0.0 $0.0 $10.7 $0.0 $21.4
* Misc Montana Tunnels $100.0 $100.0
Totals $2,768.3 $238.5 $4,775.0 $5,150.1 $175.0 $13,106.9

* Indicates From Montana Tunnels Fleet; Note: 1 Hydraulic Drill Leased
Pre-production Stripping
The cost of preproduction stripping was estimated using projected haul cycles, equipment productivity
estimates and estimated equipment operating costs. The preproduction stripping requirement for Owner
Milling totals about 8 million tonnes and is projected to cost $9.2 million. The Toll Milling case
requires increased preproduction stripping of about 11 million tonnes due to the higher cutoff grade.
The toll milling preproduction stripping is estimated to cost $11.8 million.
Process Equipment
The installed cost of process equipment was updated by SRK.
Buildings
The cost of buildings is based on the general arrangement conceptual sketches, and unit costs of
construction experienced recently in northern Ontario.

Assay Laboratory
The cost of the assay laboratory is based on actual costs incurred at two relatively recent projects in
northern Ontario. The cost includes that of the building, all internal fixtures, including heating and
ventilating systems, and assay laboratory equipment.
Tailings
The cost of the tailings impoundment is based on estimates completed by AMEC. The estimated cost of
the Tailings Facility was estimated by AMEC to be CDN$15.13 million (US$12.01), not including
contingency, with the starter dam estimated to total CDN$6.23 million. MDA believes that some of the
rock fill material may have been counted twice in the AMEC estimate, but has not adjusted the estimate.
Tailings and Reclaim Water Systems
The cost of the insulated tailings pipeline is based on the length of pipe required to support an efficient
tailings deposition strategy during the first year of operations. The cost of the insulated and heat-traced
reclaim water line is based on the assumption that this line will be placed on the surface.
Engineering, Procurement and Construction Management (EPCM) and Indirect costs
The EPCM and indirect costs are estimated to be 18% of the plant cost, from the SRK estimate.
Owner’s Costs
Owners costs are based on general and administrative costs estimated by MDA.
Small Vehicles
A total of 16 pick-up trucks, two crew vans, a flatbed truck, and an ambulance are included in the
estimate. Also included in the equipment list are 2 ATV’s, 2 small loaders with a forklift attachment, 2
mechanics trucks, a fuel truck and a lube truck.
First Fill
A provision of 4% of the plant cost is included for first fills and plant spares.
Start-Up and Commissioning Costs
A provision of 1% of the plant cost is included to cover the costs of suppliers’ representatives and
external engineering assistance required to facilitate a smooth transition from start-up to normal
operations.

Sustaining Capital Expenditures
An allowance of US $50,000 per annum for sustaining capital expenditures, commencing in year 2 of
the operations has been included. Other sustaining expenditures include replacement of small vehicles,
and work on the tailings facility
Contingency
A contingency of 15% is included for the initial capital cost and 10% thereafter.
Table 22.16 shows the details of the process plant capital cost estimate.
Table 22.16 Owner Processing Plant Capital Cost Estimate

Item Estimated Cost
Direct Costs for Process Equipment
Crushing 2,946,000
Grinding 3,228,400
Leach/CIP 2,804,100
ADR 593,800
Reagents 460,900
Services 601,700
Subtotal Process Equipment 10,634,900

Instalation 2,126,980
Subtotal Installed Equipment Cost 12,761,880
Site Preparation @ 4.0% 510,475
Concrete @ 7.0% 893,332
Structural Steel @ 10.0% 1,276,188
Electrical/Instrument @ 4.0% 510,475
Buildings/Laboratory 4,518,857
Paints/Sealants/Insulation @ 1.5% 191,428
Pipings/Valves/Couplings @ 9.0% 1,148,569
Subtotal Direct Costs 21,811,204
Indirect Costs
EPCM @ 12.0% 2,617,344
Indirect Costs @ 6.0% 1,308,672
Vehicles 430,000
Startup/Commissioning @ 1.0% 218,112
First-fills/Spare Parts @ 4.0% 872,448
Subtotal Indirect Costs 5,446,577
Total Plant 27,257,781

22.10 Black Fox Operating Cost Estimate
Basis for Estimate
The operating cost estimate of the project is in 1st quarter 2006 US dollars (US$) and is based on
detailed evaluation of four principal cost centers:
Labor;
Operating supplies;
Repair supplies; and
Power.
Table 22.17 summarizes the project operating cost estimate.
Table 22.17 Black Fox Project Estimated Operating Cost Estimate

(Base Case-Owner Milling)
Total Cost 1 2 3 4 5 6 Totals
Mining $13,368,826 $13,740,398 $12,839,799 $11,787,453 $7,413,188 $3,709,283 $62,858,947
Loader @ Crusher $124,611 $124,611 $124,611 $124,611 $124,611 $83,651 $706,706
Processing $6,566,400 $6,566,400 $6,566,400 $6,566,400 $6,566,400 $4,411,023 $37,243,023
General & Administrative $1,936,441 $1,936,441 $1,886,441 $1,836,441 $1,763,017 $1,183,161 $10,541,944
Totals $21,996,278 $22,367,851 $21,417,252 $20,314,905 $15,867,216 $9,387,119 $111,350,620

Cost /tonne ore
Mining $24.76 $25.45 $23.78 $21.83 $13.73 $10.23 $20.52
Loader @ Crusher $0.23 $0.23 $0.23 $0.23 $0.23 $0.23 $0.23
Processing $12.16 $12.16 $12.16 $12.16 $12.16 $12.16 $12.16
General & Administrative $3.59 $3.59 $3.49 $3.40 $3.26 $3.26 $3.44
Totals $40.73 $41.42 $39.66 $37.62 $29.38 $25.88 $36.36
Labor
Labor costs are based upon an assumed work force. Salaries and hourly rates applied are in accord with
current values in the region. All salaried staff and hourly paid tradesmen will work a 40-hour week.
Operating personnel will provide continuous coverage in accordance with a 42-hour week, 8 hours per
shift schedule.
A payroll loading provision of 25% is applied to all salaries and 30% to wages. In addition, a 5%
allowance is applied to hourly wages to provide for training and unscheduled overtime premiums.
Personnel will reside in the neighboring communities and will be responsible for transportation from
their domicile to the place of work. Apollo Gold will not provide transportation, on a normal basis.

Operating Supplies
Estimates of mine operating costs are based on budget quotes for major items and estimates of
explosives use, equipment fuel consumption, tire life, and bit life. Mine operating supply consumption
is based on vendor estimates and in-house knowledge from other similar operations.
The costs of processing consumables were updated by SRK, shown in Table 22.18.
Table 22.18 Processing Operating Supplies
Consumption Unit Price Unit Cost Annual Cost

Operating Supply (kg/tonne) (kg/tonne) ($/tonne) (US$)
Primary Crusher Liners 0.050 3.550 0.18 95,850
Pebble Crusher Liners 0.020 3.950 0.08 42,660
SAG Mill Liners 0.363 1.984 0.72 388,800
Ball Mill Liners 0.105 2.469 0.26 140,001
Tower Mill Liners 0.004 3.900 0.02 8,424
Grinding Balls, 100 mm 0.445 0.620 0.28 148,986
Calcium chloride 0.080 0.612 0.05 26,438
Carbon 0.066 1.411 0.09 50,286
Caustic soda 0.518 0.617 0.32 172,668
Copper sulphate 0.002 1.213 0.00 1,310
Ferric sulphate 0.028 0.441 0.01 6,667
Flocculant Percol 351 0.024 5.200 0.12 67,392
Hydrogen peroxide 0.047 1.411 0.07 35,811
Lead nitrate 0.004 1.543 0.01 3,333
Lime 0.057 0.145 0.01 4,463
Quick lime 0.794 0.265 0.21 113,429
Nitric acid 0.184 0.661 0.12 65,715
Sodium cyanide 0.628 1.853 1.16 628,389
Miscellaneous 0.08 44,919
Vehicles 0.15 80,986
Assay Lab Supplies 0.14 75,810
. Total Supply Costs 4.53 2,447,646
Repair Supplies
The mine repair supply cost is based on vendor maintenance cost estimates of equipment hourly repair
costs. The annual cost of processing repair supplies is projected to cost US$ 763,400, or US$ 1.41/t
milled.
Power
If an owner processing plant is constructed it will be the project’s major consumer of power. The
estimate of the plant annual energy consumption is based on:
The connected electrical load;

The demand, being the time equipment is available (hours per year);
The service factor, being the operating time; and
The utilization, being the anticipated percentage of full load (%).
The connected power, together with projected demand and utilization factors are applied to determine
the annual energy consumption. The weighted average unit energy cost of US$ 0.045 /kWh is provided
by Apollo Gold.
The annual energy consumption is projected to be 24.8 MW for the Owner Milling Case. The annual
cost of electric power will be $1,266,400, or $2.35/t processed.
Toll Milling Option
All of the past production from the mine has been processed off-site by others at a set fee per tonne
processed. This option has the advantage of saving on the initial capital for mill and tailings
construction. Apollo has received a quotation from a nearby mill for processing the material as shown
in Table 22.19, however, it should be noted that the rate is subject to revision after six months of
experience..
Table 22.19 Estimated Operating Cost of Toll Milling

Item Cost
Crushing* $0.70
Transportation $7.48
Processing $24.39
Totals $32.58
* Based on Crushing 20%

Mine Operating Cost Detail
A summary of the estimated mine operating cost is shown in Table 22.20
Table 22.20 Estimated Black Fox Mine Operating Cost (Owner Mill)
Annual Mining Cost Units Preproduction 1 2 3 4 5 6 Totals
Salaries & Wages ($ x 1000) 3,915.8 5,402.5 5,502.4 5,502.4 4,221.8 3,592.3 1,641.3 $29,778.5
Fuel & Power ($ x 1000) 2,712.8 3,363.8 3,805.6 3,088.9 3,174.2 1,493.7 794.6 $18,433.8
Supplies,Consumables, R&M Parts ($ x 1000) 2,723.8 4,602.5 4,432.4 4,248.4 4,391.4 2,327.1 1,273.4 $23,999.1
Annual Totals ($ x 1000) 9,352.4 13,368.8 13,740.4 12,839.8 11,787.5 7,413.2 3,709.3 $72,211.4
Total Material Mined (t x 1000) 8,038.5 9,415.3 10,285.3 8,114.2 8,219.4 3,995.1 2,329.3 50,397.2
Unit Mining Cost $/t Mined
General Mine Expense $/t Mined $0.170 $0.170 $0.155 $0.197 $0.138 $0.274 $0.316 $0.181
Drilling $/t Mined $0.041 $0.150 $0.123 $0.174 $0.181 $0.244 $0.160 $0.144
Blasting $/t Mined $0.071 $0.210 $0.144 $0.228 $0.235 $0.288 $0.291 $0.191
Loading $/t Mined $0.227 $0.193 $0.210 $0.204 $0.182 $0.189 $0.197 $0.202
Hauling $/t Mined $0.364 $0.332 $0.369 $0.357 $0.351 $0.465 $0.379 $0.365
Support $/t Mined $0.290 $0.365 $0.334 $0.423 $0.347 $0.395 $0.249 $0.350
Totals $/t Mined $1.163 $1.420 $1.336 $1.582 $1.434 $1.856 $1.592 $1.433
The annual mine salaries and wages are shown in Table 22.21 for the mine staff and in Table 22.22 for
the mine hourly employees.
Table 22.21 Estimated Black Fox Mine Staff Costs

Mine Staff Annual Burden Annual -1 1 2 3 4 5 6
Salary Cost
MINE OPERATIONS
EX Mine Manager $96,000 $24,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000 $120,000
B6 Mine Clerk $39,000 $9,750 $48,750 $48,750 $48,750 $48,750 $48,750 $48,750 $48,750 $48,750
D2 Mine Trainer $60,000 $15,000 $75,000 $75,000 $75,000 $75,000 $75,000 $0 $0 $0
D2a Drill and Blasting Superintendent $60,000 $15,000 $75,000 $75,000 $75,000 $75,000 $75,000 $0 $0 $0
D2 Mine Foreman $60,000 $15,000 $75,000 $225,000 $300,000 $300,000 $300,000 $150,000 $150,000 $150,000
Subtotal Mine Operations $543,750 $618,750 $618,750 $618,750 $318,750 $318,750 $318,750
MINE MAINTENANCE
EX Maintenance Superintendent $64,000 $16,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000 $80,000
D1 Shop Shift Foreman $50,000 $12,500 $62,500 $125,000 $187,500 $187,500 $187,500 $125,000 $125,000 $125,000
D1 Planning Engineer $40,000 $10,000 $50,000 $0 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000
Subtotal Maintenance $205,000 $317,500 $317,500 $317,500 $255,000 $255,000 $255,000
Subtotal Mine Operations $748,750 $936,250 $936,250 $936,250 $573,750 $573,750 $573,750
MINE ENGINEERING
EX Chief Mining Engineer $75,000 $18,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750
D2 Chief Surveyor $42,000 $10,500 $52,500 $52,500 $52,500 $52,500 $52,500 $52,500 $52,500 $52,500
D1 Sr Mining Engineer $60,000 $15,000 $75,000 $75,000 $75,000 $75,000 $75,000 $0 $0 $0
D1 Enviromental Engineer $60,000 $15,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000
Subtotal Mine Engineering $296,250 $296,250 $296,250 $296,250 $221,250 $221,250 $221,250
GEOLOGY AND GRADE CONTROL
D3 Chief Geologist $70,000 $17,500 $87,500 $87,500 $87,500 $87,500 $87,500 $87,500 $87,500 $87,500
D1 Ore Control Geologist $55,000 $13,750 $68,750 $68,750 $68,750 $68,750 $68,750 $68,750 $68,750 $68,750
B3 Sampler $28,000 $8,400 $36,400 $36,400 $36,400 $36,400 $36,400 $36,400 $36,400 $36,400
B2 Labor $25,000 $7,500 $32,500 $32,500 $32,500 $32,500 $32,500 $32,500 $32,500 $32,500
Subtotal Geology and Grade Control $225,150 $225,150 $225,150 $225,150 $225,150 $225,150 $225,150
Total Staff $1,270,150 $1,457,650 $1,457,650 $1,457,650 $1,020,150 $1,020,150 $1,020,150

Table 22.22 Estimated Black Fox Mine Hourly Employee Costs

Item Wage Burden Total -1 1 2 3 4 5 6
General Mine Services
Operations
B3 Trainee $30,928 $9,278 $40,206 $40,206 $80,412 $80,412 $80,412 $80,412 $40,206 $40,206
Subtotal General Mine Services $40,206 $80,412 $80,412 $80,412 $80,412 $40,206 $40,206
Drilling
Operations
D2 Drillers $42,868 $12,860 $55,728 $111,456 $501,550 $501,550 $501,550 $501,550 $334,367 $111,456
Maintenance
D2b Mechanic $44,986 $9,370 $54,356 $54,356 $163,067 $163,067 $163,067 $163,067 $108,711 $54,356
D1c Welder/Millwright $43,111 $8,264 $51,375 $0 $51,375 $51,375 $51,375 $51,375 $51,375 $51,375
Subtotal Drilling $165,811 $715,992 $715,992 $715,992 $715,992 $494,453 $217,187

Blasting
Operations
D1c Blasters $37,488 $8,264 $45,752 $45,752 $91,504 $91,504 $91,504 $91,504 $91,504 $91,504
D1a Blaster Helper $34,676 $7,527 $42,203 $84,407 $126,610 $126,610 $126,610 $126,610 $84,407 $84,407
Subtotal Blasting $130,159 $218,114 $218,114 $218,114 $218,114 $175,911 $175,911

Loading
Operations
D2b Loading Operator $44,986 $13,496 $58,481 $233,925 $350,888 $350,888 $350,888 $233,925 $116,963 $116,963
Maintenance
D2b Mechanic $44,986 $9,370 $54,356 $108,711 $108,711 $108,711 $108,711 $108,711 $54,356 $54,356
D1c Welder $43,111 $8,264 $51,375 $51,375 $51,375 $51,375 $51,375 $51,375 $51,375 $51,375
D1a Serviceman $34,676 $10,403 $45,079 $45,079 $45,079 $45,079 $45,079 $0 $0 $0
Subtotal Loading $439,091 $556,054 $556,054 $556,054 $394,012 $222,694 $222,694

Hauling
Operations
D2 Truck Driver $38,425 $11,528 $49,953 $699,339 $699,339 $799,244 $799,244 $699,339 $599,433 $199,811
Maintenance
D2b Mechanic $44,986 $9,370 $54,356 $217,423 $217,423 $217,423 $217,423 $217,423 $163,067 $54,356
D2b Electrician $44,986 $9,370 $54,356 $0 $54,356 $54,356 $54,356 $54,356 $54,356 $54,356
D1c Welder $43,111 $8,264 $51,375 $0 $0 $0 $0 $0 $0 $0
D1a Tireman $34,676 $10,403 $45,079 $0 $45,079 $45,079 $45,079 $45,079 $45,079 $45,079
D1a Serviceman $39,011 $11,703 $50,714 $0 $50,714 $50,714 $50,714 $50,714 $50,714 $50,714
Subtotal Hauling $916,761 $1,066,911 $1,166,816 $1,166,816 $1,066,911 $912,649 $404,316

Support
Operations
D2b Loader @ Crusher $41,237 $12,371 $53,608 $0 $107,216 $107,216 $107,216 $107,216 $107,216 $107,216
D2a Track Dozer Operato $41,237 $12,371 $53,608 $321,647 $428,863 $428,863 $428,863 $214,431 $214,431 $214,431
D2 Grader Operator $41,237 $12,371 $53,608 $214,431 $214,431 $214,431 $214,431 $107,216 $107,216 $107,216
D2 Water Truck Driver $38,425 $11,528 $49,953 $49,953 $49,953 $49,953 $49,953 $49,953 $49,953 $49,953
Maintenance
D2b Mechanic $44,986 $9,370 $54,356 $163,067 $217,423 $217,423 $217,423 $163,067 $163,067 $163,067
D1c Lt. Veh. Mechanic $44,986 $9,370 $54,356 $163,067 $217,423 $217,423 $217,423 $108,711 $108,711 $108,711
D1c Welder $43,111 $8,264 $51,375 $0 $51,375 $51,375 $51,375 $0 $0 $0
D1a Apprentice $34,676 $10,403 $45,079 $0 $45,079 $45,079 $45,079 $0 $0 $0
B6 Storemen $31,865 $9,559 $41,424 $41,424 $82,848 $82,848 $82,848 $82,848 $82,848 $82,848
Subtotal Support $953,589 $1,414,611 $1,414,611 $1,414,611 $833,442 $833,442 $833,442

Summary
Subtotal Operations $1,801,115 $2,650,765 $2,750,670 $2,750,670 $2,212,155 $1,745,695 $1,123,161
Subtotal Maintenance $844,503 $1,401,329 $1,401,329 $1,401,329 $1,096,728 $933,661 $770,594
Totals $2,645,618 $4,052,094 $4,151,999 $4,151,999 $3,308,883 $2,679,356 $1,893,755
The estimated mine equipment operating cost is shown in Table 22.23.

Table 22.23 Mine Equipment Estimated Costs

Item Fuel Fuel Lube, Oil Tires Under- R&M Special Total
l/hr $/hr & Filters $/hr Carriage Reserve Wear Items
Rotary Drill - 251 mm 50 $37.50 $12.00 $10.00 $40.00 $65.55 $165.05
Hydraulic Drill - 165 mm 22 $16.50 $9.00 $5.00 $20.00 $22.67 $73.17
Hydraulic Drill - 101 mm 22 $16.50 $9.00 $5.00 $20.00 $13.60 $64.10
16 cm Hydraulic Shovel 180 $135.00 $28.00 $30.00 $110.00 $28.00 $331.00
10.5 cm Hydraulic Shovel 130 $97.50 $15.34 $25.00 $70.00 $20.00 $227.84
11.5 cm FEL 100 $75.00 $12.00 $22.13 $45.00 $6.00 $160.13
6.5 cm FEL 40 $30.00 $7.50 $6.40 $10.00 $3.00 $56.90
150 t truck 100 $75.00 $5.00 $36.00 $20.00 $1.50 $137.50
100 t truck 75 $56.25 $4.00 $17.00 $20.00 $1.00 $98.25
Dozer D11R 115 $86.25 $10.70 $28.80 $25.00 $4.00 $154.75
Dozer D9R 60 $45.00 $18.00 $17.00 $15.00 $3.00 $98.00
Grader 16H 35 $26.25 $5.04 $6.82 $30.00 $1.50 $69.61
4 cm Mass Excavator 60 $45.00 $4.00 $10.00 $40.00 $8.00 $107.00
Lube Truck 10 $7.50 $0.50 $0.56 $3.50 $0.20 $12.26
Fuel Truck 8 $6.00 $0.20 $0.56 $3.00 $0.20 $9.96
Mechanics Truck 5 $3.75 $0.20 $0.56 $3.00 $0.20 $7.71
Pickup Trucks 2 $1.50 $0.10 $0.12 $2.50 $0.10 $4.32
Water Truck 30 $22.50 $3.00 $3.20 $10.00 $2.50 $41.20
Light Plant 2 $1.50 $0.10 $0.06 $1.25 $2.91
Sanding/Stemming Truck 15 $11.25 $2.00 $0.47 $5.00 $1.00 $19.72
Backhoe/Loader 15 $11.25 $3.00 $1.18 $8.00 $0.50 $23.93
Wheel Skidder 35 $26.25 $4.00 $6.00 $12.00 $3.00 $51.25
45 ton Crane 30 $22.50 $3.00 $1.18 $12.00 $2.00 $40.68
Skid Loader 12 $9.00 $1.00 $1.18 $2.00 $0.20 $13.38
Low Boy 10 $7.50 $1.00 $0.70 $3.50 $0.25 $12.95
Flatbed 10 $7.50 $1.00 $0.70 $3.00 $0.25 $12.45
Explosives Truck 15 $11.25 $2.00 $0.93 $5.00 $0.20 $19.38
Ambulance 5 $3.75 $0.60 $0.93 $3.00 $0.50 $8.78
Crew Van 5 $3.75 $0.50 $1.40 $3.00 $0.20 $8.85
Bus 15 $11.25 $1.50 $1.40 $5.00 $0.50 $19.65
Forklift 3 $2.25 $0.60 $0.50 $1.50 $0.10 $4.95
ATV 2 $1.50 $0.40 $0.50 $2.00 $0.10 $4.50
The estimated mining costs for the Owner Milling option are shown in Table 22.24.

Table 22.24 Mine Operating Cost Estimate Detail

MINE OPERATING COST Preproduction 1 2 3 4 5 6 Totals
GENERAL MINE EXPENSE & ENGINEERING
Salaries & Wages ($ x 1000) 1,310.4 1,538.1 1,538.1 1,538.1 1,100.6 1,060.4 712.2 8,797.7
Supplies ($ x 1000) 60.0 60.0 60.0 60.0 36.0 36.0 24.2 336.2
Subtotal General Mine ($ x 1000) 1,370.4 1,598.1 1,598.1 1,598.1 1,136.6 1,096.4 736.4 9,133.8
DRILLING
Salaries & Wages ($ x 1000) 165.8 716.0 716.0 716.0 716.0 494.5 145.9 3,670.1
Fuel & Lube ($ x 1000) 60.8 270.8 214.5 271.7 303.5 191.3 89.9 1,402.5
Consumables, R&M Parts ($ x 1000) 99.7 425.2 334.9 421.4 469.6 289.5 136.1 2,176.4
Subtotal Drilling ($ x 1000) 326.2 1,411.9 1,265.5 1,409.1 1,489.1 975.3 371.8 7,249.0
BLASTING
Salaries & Wages ($ x 1000) 130.2 218.1 218.1 218.1 218.1 175.9 118.2 1,296.7
Consumables & Direct Costs ($ x 1000) 437.9 1,760.3 1,266.8 1,632.1 1,712.4 974.1 560.6 8,344.2
Subtotal Blasting ($ x 1000) 568.0 1,978.5 1,485.0 1,850.2 1,930.5 1,150.0 678.8 9,640.9
LOADING
Salaries & Wages ($ x 1000) 439.1 556.1 556.1 556.1 394.0 222.7 149.6 2,873.5
Fuel & Lube ($ x 1000) 685.4 626.6 792.9 544.7 546.1 264.5 154.1 3,614.4
Subtotal Loading ($ x 1000) 1,827.4 1,816.4 2,157.9 1,652.0 1,492.4 755.0 459.7 10,160.9
HAULING
Salaries & Wages ($ x 1000) 916.8 1,066.9 1,166.8 1,166.8 1,066.9 912.6 271.6 6,568.4
Fuel & Power ($ x 1000) 1,170.7 1,199.9 1,531.6 1,005.9 1,058.0 549.3 355.5 6,870.9
Consumables, R&M Parts ($ x 1000) 841.4 862.4 1,100.8 723.0 760.4 394.8 255.5 4,938.4
Subtotal Hauling ($ x 1000) 2,928.9 3,129.2 3,799.3 2,895.8 2,885.4 1,856.7 882.6 18,377.8
SUPPORT
Salaries & Wages ($ x 1000) 953.6 1,307.4 1,307.4 1,307.4 726.2 726.2 243.9 6,572.1
Fuel & Lube ($ x 1000) 795.9 1,266.6 1,266.6 1,266.6 1,266.6 488.7 195.1 6,546.0
Subtotal Support ($ x 1000) 2,331.5 3,434.7 3,434.7 3,434.7 2,853.5 1,579.8 580.0 17,648.9
SUMMARY
Salaries & Wages ($ x 1000) 3,915.8 5,402.5 5,502.4 5,502.4 4,221.8 3,592.3 1,641.3 29,778.5
Fuel & Power ($ x 1000) 2,712.8 3,363.8 3,805.6 3,088.9 3,174.2 1,493.7 794.6 18,433.8
Supplies,Consumables, R&M Pa ($ x 1000) 2,723.8 4,602.5 4,432.4 4,248.4 4,391.4 2,327.1 1,273.4 23,999.1
Total Mining ($ x 1000) 9,352.4 13,368.8 13,740.4 12,839.8 11,787.5 7,413.2 3,709.3 72,211.4

Process Operating Cost Detail
A summary of the process operating cost estimate for Owner Milling Case 1 (no pebble crushing) is
shown in Table 22.25.
Table 22.25 Estimated Process Operating Cost – Owner Milling Case
OPERATING COST CATEGORY ANNUAL COST, US$ COST/TONNE PROCESSED, US$ % of Total
Labor 2,087,231 3.87 31.8%
Operating Supplies 2,447,646 4.53 37.3%
Repair Parts/Supplies 763,392 1.41 11.6%
Power 1,266,417 2.35 19.3%
Total Operating Costs 6,564,686 12.16 100.0%
General and Administrative Cost Detail
The estimated general and administrative costs are shown in Table 22.26.

Table 22.26 Estimated General and Administrative Costs

Administration Annual Burden Annual Owners Cost 1 2 3 4 5 6
Salary Cost
Managers
EX General Manager $105,000 $26,250 $131,250 $131,250 $131,250 $131,250 $131,250 $131,250 $131,250 $88,156
D6 Human Resources Manager $75,000 $18,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750 $62,969
EX Environmental Manager $75,000 $18,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750 $93,750 $62,969
EX Safety and Loss Control Manager $60,000 $15,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $50,375
D6 Controller $70,000 $17,500 $87,500 $87,500 $87,500 $87,500 $87,500 $87,500 $87,500 $58,771
D4 Purchasing Manager $60,000 $15,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $75,000 $50,375
D2 Systems Analyst $50,000 $12,500 $62,500 $62,500 $62,500 $62,500 $62,500 $62,500 $62,500 $41,979
Totals $618,750 $618,750 $618,750 $618,750 $618,750 $618,750 $415,594

Administrative Staff
D2 Human Resources Assistant $45,000 $11,250 $56,250 $56,250 $56,250 $56,250 $56,250 $56,250 $56,250 $37,781
C6 Secretary $40,000 $10,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $50,000 $33,583
D1b Accountant $53,000 $13,250 $66,250 $66,250 $66,250 $66,250 $66,250 $66,250 $66,250 $44,498
D1 Accounting Clerks $32,000 $8,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $26,867
D2 Purchasing Agent $50,000 $12,500 $62,500 $125,000 $125,000 $125,000 $125,000 $125,000 $125,000 $83,958
D2 Expiditer $32,000 $8,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $26,867
B3 Site Guard $28,000 $7,000 $35,000 $140,000 $140,000 $140,000 $140,000 $105,000 $105,000 $70,525
B1 Janitor $25,000 $6,250 $31,250 $62,500 $62,500 $62,500 $62,500 $62,500 $62,500 $41,979
Totals $580,000 $580,000 $580,000 $580,000 $545,000 $545,000 $366,058
Total Administrative Personnel $1,198,750 $1,198,750 $1,198,750 $1,198,750 $1,163,750 $1,163,750 $781,652
Administrative Costs
Supplies $60,000 $60,000 $60,000 $60,000 $60,000 $60,000 $40,200
Postage and Couriers $20,000 $20,000 $20,000 $20,000 $20,000 $20,000 $13,400
Communications $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $20,100
Travel $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $20,100
Outside Services $40,000 $40,000 $40,000 $40,000 $40,000 $40,000 $26,800
Enviromental Monitoring $36,000 $36,000 $36,000 $36,000 $36,000 $36,000 $24,120
Community Relations $100,000 $50,000 $50,000 $25,000 $25,000 $25,000 $16,750
Insurance $125,000 $125,000 $125,000 $125,000 $125,000 $125,000 $83,750
Recruting and Relocation $60,000 $30,000 $30,000 $30,000 $20,000 $10,000 $6,700
Safety Supplies $36,000 $36,000 $36,000 $36,000 $36,000 $36,000 $24,120
Security Supplies $6,000 $6,000 $6,000 $6,000 $6,000 $6,000 $4,020
Vechicle and Bus Operation $63,142 $101,027 $101,027 $101,027 $101,027 $56,575 $37,905
Customs $30,000 $30,000 $30,000 $30,000 $30,000 $30,000 $20,100
Computer Equipment & Software $30,000 $30,000 $30,000 $30,000 $30,000 $10,000 $6,700
Training $100,000 $50,000 $50,000 $25,000 $20,000 $20,000 $13,400
Power $24,000 $24,000 $24,000 $24,000 $24,000 $24,000 $16,080
Water System $24,000 $24,000 $24,000 $24,000 $24,000 $24,000 $16,080
Road Maintenance-Snow Removal $18,000 $18,000 $18,000 $18,000 $18,000 $18,000 $12,060
Total Administrative Expenses $832,142 $740,027 $740,027 $690,027 $675,027 $600,575 $402,385
Total General and Administrative $2,030,892 $1,938,777 $1,938,777 $1,888,777 $1,838,777 $1,764,325 $1,184,038
22.11 Black Fox Pre-tax Economics
The Black Fox economic assessment is based on the proven and probable reserves for each of the four
options:
Owner Milling Option.
Toll Milling – In the Toll Milling Case the ore would be contract crushed and shipped to a
nearby mill for processing based on quotes from the company for toll milling, a mine contractor
for crushing, and a trucking company for transportation. All historic production was toll milled.
All of the evaluations to date indicate better returns from the Toll Milling case, however MDA suggests
that an owner operated mill be given serious consideration due to several factors:

The present estimate of reserves from the property is likely to underestimate the tonnage of ore-
grade material, based on the estimate of historic production from the current model.
The potential development of underground minable reserves is considered good.
The operating cost of Toll Milling is projected to be about $50 per ounce of gold more expensive
that Owner Milling. On a pre-tax basis about 850,000 ounces needs to be produced to break
even with the added capital cost and reduced operating cost of Owner Milling vs Toll Milling.
The after tax evaluation is likely to show a lower number of ounces required to breakeven.
Improved control of cost and recovery.
Table 22.27 shows a summary of the Black Fox pre-tax economics of the two cases at various gold
prices.
Table 22.27 Pre-tax Economic Evaluation Summary

Production Rate Cutoff Grade Gold Price Case Pretax Cashflow 3% NPV 5% NPV IRR Op Cost Op Cost
tonnes/year g Au/t US $/oz US $ Millions US $ Millions US $ Millions % US $/oz US $/t ore
540,000 0.96 500 Owner Mill 33.9 23.3 17.3 13.2% 255.8 36.4
540,000 0.96 550 Owner Mill 55.7 42.4 35.0 21.3% 255.8 36.4
540,000 0.96 600 Owner Mill 77.4 61.6 52.7 29.3% 255.8 36.4
540,000 1.90 500 Toll Mill 45.5 39.5 35.9 66.0% 304.9 65.3
540,000 1.90 550 Toll Mill 64.5 56.8 52.3 94.6% 304.9 65.3
540,000 1.90 600 Toll Mill 83.5 74.2 68.6 123.6% 304.9 65.3
Figure 22.2 illustrates the pre-tax cashflow sensitivity to operating cost, capital cost, recovery and gold
price for Owner Mill and the Toll Milling options. Figure 22.3 shows the sensitivity of pre-tax Internal
Rate of Return to operating cost, capital cost, recovery and gold price for owner mill and toll milling
options.

Figure 22.2 Sensitivity of Pre-tax Cash Flow
100.0
90.0
80.0
70.0
NPV (5%) Millions
60.0
50.0
40.0
30.0
20.0
10.0
0.0
0.8 0.85 0.9 0.95 1 1.05 1.1 1.15 1.2
% of Base Case
Figure 22.3 Sensitivity of Pre-tax Internal Rate of Return
180%
160%
140%
120%
100%
IRR
80%
60%
40%
20%
0%
0.8 0.85 0.9 0.95 1 1.05 1.1 1.15 1.2
% of Base Case

23.0 REFERENCES
, 1996, Exall Resources Limited, Hislop-Beatty Gold Project, Metheson, Ontario, Feasibility
Study, Canadian Mine Development
AMEC Earth and Environmental, 2004, Black Fox Project – Mine Closure Plan, AMEC Earth and
Environmental
AMEC Earth and Environmental, 2004, Tailings Dam Facility Estimate, AMEC Earth and
Environmental
AMEC Earth and Environmental, 2004, Open Pit Overburden, Waste Rock Stockpile and Tailings
Impoundment, Pre-feasibility Design, AMEC Earth and Environmental
AMEC Earch and Environmental, 2005, Draft Hydrogeological Report, AMEC Earth and
Environmental
AMEC Earth and Environmental, 2006, Draft Geochemical Characterization of Waste Rock, AMEC
Earth and Environmental
Agnerian, H., 1998, Review of the December 31, 1997 Mineral Resources and Minable Reserves of the
Glimmer Mine, Roscoe Postle Associates Inc.
Barclay, W., 2000, Report on a Structural Geology Study at the Glimmer Mine A1 Zone, Northern
Ontario
Cameron, A., 2003, Preliminary Assessment of Pit Slope Parametes for the Apollo Gold Black Fox
Project, Golder Associates
Evans, L. and Roscoe, W., 1996, Report on the In Situ Reserves of the Glimmer Deposit of Exall
Resources Limited for Hillsborough Resources Limited, Roscoe Postle Associates Inc.
Evans, L., 1997, Report on the December 31, 1996 and March 31, 1997 Mineral Resources and Minable
Reserves of the Glimmer Mine, Roscoe Postle Associates Inc.
Evans, L. and Roscoe, W., 1996, Preliminary Cutting Factors for the Glimmer Mine Muck and Chip
Assays; Draft Memorandum to Mynyr Hoxha, Roscoe Postle Associates Inc.
Evans, L., 1999, Glimmer Mine Resource and Reserve Audit (December 31, 1998) Prepared For Exall
Resources Limited, Roscoe Postle Associates Inc.

Ferron, C. and Trang, C, and Vincent F., 1999, Test Program to Investigate Process Alternatives for
Recovery of Gold From Glimmer Mine Ore, Progress Report No. 1, Lakefield Research
Ferron, C. and Trang, C, 1999, A Pilot Plant Investigation of the Recovery of Gold from Glimmer Mine
Ore Samples, Progress Report No. 2, Lakefield Research
Garber, J., 1989-1994, Summary Report of the Phase I-VIII Diamond Drill Program Glimmer Property,
Noranda Exploration Company, Ltd.
Gow, N., 2003, Black Fox Project, Sampling and Assay Procedures, Roscoe Postle Associates Inc.
Gross, M. , 1997, Glimmer Mine Work Plan Calendar Year 1998, Exall Resources Ltd.
Hoxha, M. and James, R., 1998, A preliminary model for the emplacement of gold bearing structures at
the Glimmer Mine gold deposit. Guidelines for exploration and mining. Exall Resources Ltd.
Ingen, R. van, 1989, The Discovery of Gold Mineralization on the Property of Glimmer Resources by
Noranda Exploration Co. Ltd. In Beatty and Hislop Townships, Lander Lake Mining Division,
Ontario
Kuestermeyer, Al, 2006, Spreadsheet Report, Updated Mill Capital and Operating Cost Estimate, SRK
Consulting Group
Lim, J. 2002, Timmons Mayor Jamie Lim on Access to Land and Pride in our Mining Industry,
Northeast Ontario Mines and Minerals Symposium
Lomas, S., 1991, Geology Report Glimmer Property, Hislop Twp., Hemlo Gold-Glimmer Joint Venture,
Noranda Exploration Company, Ltd.
Michaud, M and Sherlock, R., 1999, Glimmer Mine Resource Audit, Steffen Robertson and Kirsten
(Canada) Inc.
Ounpuu, M, and Sarbutt, K, 1996, A Laboratory Investigation of the Recovery of Gold from the Hislop-
Beatty Project from Samples Submitted by Exall Resources Ltd. Progress Report No. 1,
Lakefield Research Ltd.
Pitard, Francis, 2005, Review of Sampling Protocols for the Black Fox Mine, Francis Pitard Sampling
Consultants, LLC

Pitard, Francis, 2005, Letter review, Black Fox Observations, Francis Pitard Sampling Consultants, LLC
Pitard, Francis, 2005, Letter review, Mini-Bulk Samples, Francis Pitard Sampling Consultants, LLC
Taggart, P, 2003, Black Fox Project Preliminary Feasibility Study, Metallurgy and Processing, Peter
Taggart and Associates
Swider, R, 1999, Review and Summary of Bench Scale Metallurgical Test Program and Preliminary
Capital and Operating Cost Estimates, Exall Resources Ltd.
Swider, R, 1999, Review of Pilot Plant Operations: Related Metallurgical Testing and Selection of
Flowsheet and Process Design Parameters, Exall Resources Ltd.
Webster, C, 2004, Environmental Permitting and Assessment Requirements for Proposed Mine
Expansion, AMEC Americas
Wislesky, I, and Lemieux, M. Pre-Feasibility Study Proposed Tailings Area, Black Fox Project,
Matheson, Ontario, Golder Associates

24.0 AUTHOR’S CERTIFICATE

I, Neil B. Prenn, P. Eng., do hereby certify that:
1. I am currently employed as Principal Engineer by:

Mine Development Associates, Inc.
Reno, Nevada 89502
2. I graduated with an Engineer of Mines degree from the Colorado School of Mines in
1967.
3. I am a Registered Professional Mining Engineer in the state of Nevada (#7844) and a

member of the Society of Mining Engineers and councilor-at-large for the Mining and
Metallurgical Society of America.
4. I have worked as an engineer for a total of 35 years.
5. I have read the definition of “Qualified Person” set out in National Instrument 43-101
(“NI 43-101”) and certify that by reason of my education, affiliation with a professional
association (as defined in NI 43-101) and past relevant work experience, I fulfill the
requirements to be a “Qualified Person” for the purposes of NI 43-101.
6. I am responsible for the preparation of the technical report titled Technical Report, Black
Fox Project, Matheson, Ontario Canada and dated August 14, 2006 (the “Technical
Report”) relating to the Black Fox property. I visited the Black Fox project site on
August 19, 2003 for two days.
7. Prior to the visit in August 2003 I had no involvement with the Black Fox Project. In
2003 I prepared report titled Technical Report, Black Fox Project, Matheson, Ontario
Canada and dated August 26, 2003 and in 2004 I prepared the report title Technical
Report, Black Fox Project, Matheson, Ontario Canada and dated March 25, 2004.
8. I am not aware of any material fact or material change with respect to the subject matter
of the Technical Report that is not reflected in the Technical Report, the omission to
disclose which makes the Technical Report misleading.

9. I am independent of the issuer applying all of the tests in Section 1.6 of National
Instrument 43-101.
10. I have read National Instrument 43-101 and Form 43-101F1, and the Technical Report
has been prepared in compliance with that instrument and form.
11. I consent to the filing of the Technical Report with any stock exchange and other
regulatory authority and any publication by them, including electronic publication in the
public company files on their websites accessible by the public, of the Technical Report.
Dated this 14th day of August 2006.
Signature of Qualified Person
Neil B. Prenn
Print Name of Qualified Person

APPENDIX A
Proposed Mill Drawings
APPENDIX B
Pitard Studies
Summary of Sampling Protocol for the Black Fox Mine – Coarse Gold Issues
November 28, 2005

FRANCIS
PITARD
SAMPLING
CONSULTANTS
November 28, 2005
From: Mr. Francis F. Pitard

Francis Pitard Sampling Consultants, LLC
14800 Tejon Street
Broomfield, CO 80020, USA
Phone: 303-451-7893
Fax: 303-280-1396
E-mail: fpsc@aol.com
To: Mr. Richard K. Larsen

Senior Exploration Geologist
Black Fox Mine – Apollo Gold, Inc.
Dear Dick:
This letter is a quick summary of my observations using the information you sent me about the size of the
gold particles at the Black Fox Mine project. It is very brief, but to the point, to get you started in your
forthcoming discussions with MDA for the feasibility study. You will receive a complete, comprehensive
report just before Christmas.
The facts:
• On some occasions, 0.15-cm gold particles can be observed.

• 0.06-cm gold particles are very common.
• Open pit cutoff grade could be around 1.105 g/t.
• Underground cutoff grade could be around 2.80 g/t.
• Average grade delivered to the plant could be around 5.98 g/t.
• Though large gold particles are far more difficult to find in the low grade, they do exist in low
grade as well.
Sampling requirements for 1.105 g/t cutoff efficiency
The following nomograph (See figure 1) is set for a sampling error no larger than ±15% relative, an
absolute maximum beyond which gold assays would be highly skewed toward a too low grade.
• To account properly for 0.06-cm gold particles, a 6950-g sample needs to be assayed entirely,
through a small gravity concentrator. A diamond core sample can provide enough material for
that.
• To account properly for 0.15-cm gold particles, a 109-Kg sample needs to be assayed entirely,
through a small gravity concentrator. A diamond core sample cannot provide enough material for
that. A reverse circulation sample may provide enough material for that. A blasthole sample will
provide enough material for that.
14800 TEJON STREET BROOMFIELD CO 80020 USA PHONE: 303-451-7893 1

FAX: 303-280-1396 E-MAIL: fpsc@aol.com http://www.fpscsampling.com
Figure 1. Sampling requirements for 1.1 g/t ore
that.
through a small gravity concentrator. A diamond core sample cannot provide enough material for
that. A reverse circulation sample provides enough material for that.

Sampling requirements for 5.98 g/t plant grade control efficiency
that.
through a small gravity concentrator. A 3-meter HQ diamond core sample can provide enough
material for that. A reverse circulation sample provides enough material for that.

Validation of the existing database for the feasibility study
Phase 2 must consist of re-assaying a large number of samples, say at least 200, using as large sample
rejects as practically possible, compositing if necessary. These large composites will allow two things:
1. First have a grade estimate using the conventional way, assaying a way too small 30 or 50-g
sample, or even a too-small screen fire assays.
2. Second have a grade estimate using the right way with large enough samples and a mini-
concentrator.
The comparison of both databases obviously has huge implications in your feasibility study: Not only the
average gold grade is underestimated, but above all, a huge number of ore blocks are called waste
unfairly. You may get a substantial bonus from the real average grade, but you will most certainly get a
huge improvement as far as the ore reserves are concerned.
All this is making the very optimistic assumption that gold particles do not cluster, which would greatly
aggravate the problem: This will be discussed at length as far as the possible in situ nugget effect is
concerned, in my report next month.
This is food for thought for now. Debate these things with MDA: They are familiar with my work with
similar cases at other places.
Best regards,
Francis F. Pitard

Review of Sampling Protocol for the Black Fox Mine – Coarse Gold Issues
December 21, 2005

REVIEW OF SAMPLING PROTOCOLS FOR THE
BLACK FOX MINE
- COARSE GOLD ISSSUES -
December 21, 2005
Prepared for
Black Fox Mine – Apollo Gold, Inc.
Francis F. Pitard, Author
FRANCIS
PITARD
SAMPLING
CONSULTANTS
14800 Tejon Street à Broomfield à CO à 80020 à USA à Phone: 303.451.7893

Fax: 303.280.1396 à E-mail: fpsc@aol.com à http: //www.fpscsampling.com
1
A word of wisdom for Vice
Presidents:
“Sampling of coarse gold is a well-
established, unfriendly science. Either
you learn about necessary requirements
and the many subtle implications, and
apply them wisely, or you miss
exploration opportunities others will
enjoy later on. Or worse, you may totally
mismanage an existing operation. In
sampling of coarse gold, if something
can go wrong, it usually will, and in a
devastating way.”
Francis F. Pitard
EXECUTIVE SUMMARY
Consulting assistance leading to feasibility study was requested for the Black Fox Exploration
works by Apollo Gold Inc. Mr. Francis Pitard reviewed the gold mineralogical information about
this project and the description of existing sampling protocols. During this time, his principal
interlocutor was Mr. Richard K. Larsen, Senior Exploration Geologist.
• In this report, a dot identifies an important observation or a conclusion.
¾ An arrow identifies a recommendation.
In this report, for scientific simplicity, consistency, and plain logic, only the metric system of units
is used.
GETTING OUT OF A DANGEROUS PARADIGM
Within the 2004-2005 period alone, FPSC was involved in 5 gold deposits around the world
where coarse gold (i.e., gold larger than 100µ) was present. It is always the same scenario:
People strongly believe they can study these deposits using conventional approaches valid only
for finely disseminated and not for coarse, clustering gold. These people are wrong. If pursuing
the wrong strategy, several things may later happen:
1. You can walk away from an excellent gold deposit.

2. You proceed with the exploitation of a gold deposit and ruin its real natural resources.
3. Feasibility studies are not valid, and mislead investors.
4. Massive conciliation problems will take place with the future processing plant.
5. A lot of good ore will go to the waste because the main focus is only the very fine gold
easy to sample.
6. At times, some waste will go to the plant.
7. The company involved will quickly loose credibility in the eyes of stakeholders, being
unable to produce believable, unadjusted gold grade estimates.
Therefore, let’s carefully review a few facts about the Black Fox gold ore before it is too late.
2
THE GOLD HETEROGENEITY FACTS
Test suggested by FPSC, early 2005
A thorough study of the distribution of coarse gold particles in the Black Fox ore was performed
by Apollo Gold, Inc. at Mr. Francis Pitard’s recommendation. Details and results of the tests can
be found in Mr. Richard K. Larsen’s interim report dated November 23, 2005.
The facts:
• On some occasions, 0.15-cm gold particles can be observed.

• 0.06-cm gold particles are very common.
• Open pit cutoff grade could be around 1.105 g/t.
• Underground cutoff grade could be around 2.80 g/t.
• Average grade delivered to the plant could be around 5.98 g/t, but can go as high as
10.00 g/t.
• Though large gold particles are far more difficult to find in the low grade, they do exist in
low grade as well.
• Gold is present in quartz veins, more or less at the same place as several sulfides
minerals such pyrite and arsenopyrite, and other minerals such as chlorite, fuchsite,
epidote, magnetite, and zircon.
Conclusions
• The size of the core samples can account for local geology, but cannot account for the
local gold content: Relative to the size of the coarse gold, the core mass is too small. The
resulting effect is called the In Situ Nugget Effect: It is of the utmost importance for
management to understand it.
• As a result, Poisson skewness enters the database, leading to a frequent under-
estimation of many ore blocks, and an occasional over-estimation of a few ore
blocks.
• Such skewness, if carried too far, as I believe is the case, can under-estimate the gold
content of the deposit. However, and this is very important, it is an undeniable fact that
the ore reserves are under-estimated. This is something to keep in mind: Poisson
skewness affects the grade somewhat, but above all, makes a disaster on the estimation
of the ore reserves, unless you are very lucky by having sharp, natural and obvious ore
boundaries (e.g., Midas mine in Nevada).
• By the time the sample is taken to the laboratory sample preparation, you have already
lost its main purpose which is to be reasonably representative of all gold particle size
fractions. Then, the preparation and assaying procedure, ignoring the potential presence
of coarse gold, makes things even worse, most likely introducing a superimposed
secondary Poisson skewness in the database: At that stage we no longer know what we
are doing.
Recommendations
¾ Become more comfortable with the Sampling Theory as applied to coarse gold. I
enclosed some necessary basics in this report to get you started. But, ultimately, it would
require a 2-day course to get to the roots of the problem in a logical way with the key
executives of Apollo Gold Inc.
¾ Clearly understand that drill core samples will always be too small. But, awareness of this
can go a long way in selecting a better strategy to quantify and locate ore reserves.
¾ Clearly understand that conventional Fire Assay cannot and will not provide reliable data.
In the Black Fox case even screen fire assay, using a limited sample mass, is weak. Only
pre-concentration of a finely crushed large sample, followed by the fusion of the entire
3
concentrate, and regular Fire Assay of the tails, followed by the calculation of a weighted
average gold content, will help you to better visualize what the deposit is.
¾ A careful validation of the existing database for the feasibility study must be initiated,
consisting of re-assaying a large number of samples, say at least 100, using as large
sample rejects as practically possible, compositing if necessary (e.g., 14 Kg). These large
composites will allow two things:
1. First have a grade estimate prepared the conventional way, assaying a too small 30
or 50-g sample, or even a too-small screen fire assays.
2. Second have a grade estimate prepared the right way with large enough samples
and a mini-concentrator.
¾ The comparison of both databases (i.e., wrong way versus right way) obviously has huge
implications in your feasibility study: Not only the average gold grade is underestimated,
but above all, a very significant number of ore blocks are unfairly called waste. You may
get a substantial bonus from the real average grade, but you will most certainly get a
significant improvement as far as the ore reserves are concerned.
All this is making the very optimistic assumption that gold particles do not cluster, which
would greatly aggravate the problem. This issue must also be resolved in the near future.
THE NECESSARY TOOLS
In this report, I will use three different, well-established statistical/sampling tools, each appropriate
for its own area of influence:
1. The In-Situ Nugget Effect NE, quantified using Gy, Ingamells, and Pitard’s literature, to
appreciate the effect of the field sample mass on the generated database.
2. The intermediary Fundamental Sampling Error FE, quantified using Gy, Pitard, and
François-Bongarçon’s literature. This phase is actually not critically important in the case
of coarse gold liberating when the material is crushed to -2mm.
3. The final Fundamental Error taking place after the material is crushed fine enough to
liberate a substantial amount of gold, quantified using Gy and Pitard’s literature.
• In your case, points #1 and #3 are critically important.
PHASE #2 RECOMMENDED TEST
The Phase #2 recommended test is fully described in pages 16 and 17 of this report. For the
recommended one hundred 14-Kg bulk samples proceed as follows:
1. Do a series of fifty 14-Kg bulk samples first.

2. The study of the first 50 bulk sample results will determine if you should proceed with 50
more. Results from the 50 first bulk samples may already provide a clear-cut enough
message.
3. The test may also shed light on the possible clustering effect, which would make the 14-
Kg sample used in the test weak as well. This would be bad news for ore grade control,
but most certainly good news for the possibilities offered by the deposit.
Francis Pitard Sampling Consultants, L.L.C. has used its best efforts to perform consultation and
recommendations with that standard of care, skill, and diligence using sound and professional
principles and practices in accordance with normally accepted industry standards. You are at
liberty to accept or reject all or any part of the recommendations without liability to Francis Pitard
Sampling Consultants, L.L.C.
4
A SUMMARY OF THE SAMPLING THEORY FOR COARSE GOLD
The content of this report would be ludicrous for Apollo Gold Inc. without a short introduction to
the Theory of Sampling as applied for coarse gold. The following material is a combination of my
long experience with Dr. Pierre Gy, the well-known founder of the Sampling Theory [1], and with
Oliver Ingamells, well-known master of Poisson statistics, with whom I had the privilege to work
for more than 10 years, [2]. Please, spend the time to digest the following material, then what will
be said later in this report may make better sense.
SAMPLING PROTOCOL AND SAMPLING ERRORS
The sampling protocol is a set of parameters that defines and quantifies the sampling process,
the comminution, and sub-sampling steps that culminate in the assaying process. Because the
final assay aliquot is a very small fraction of the original lot it represents, it is subject to sampling
errors. The assay is never “true”.
Sampling errors are the result of either Constitution Heterogeneity (e.g., differences in gold
content between individual rock fragments) or Distribution Heterogeneity (e.g., differences in gold
content between groups of fragments), as shown by the Sampling Theory, [1], [3], [4], [5].
A thorough mineralogical study of gold particles and their associations is essential to constructing
a sampling nomograph and thereafter a sampling protocol. The following characteristics of gold
mineralization should be known:
• How many types of gold mineralization have been identified in the deposit?
• What is the largest size of the gold particles?
• What is the size distribution of the gold particles?
• Do gold particles cluster?
• Do some areas show coarse gold with no fine gold around?
• Is visible gold associated with quartz veins?
• Does gold show enrichment along a geological contact, or a major quartz vein contact?
• Is gold associated or nearby other major minerals (e.g., sulfides such as pyrite or
arsenopyrite, or other relevant indicators)?
• Is gold alloyed with another metal?
One class of sampling errors occurs as the result of the choice of parameters for the sampling
protocol, as outlined below:
The In-situ Nugget Effect

This source of gold content variability is directly proportional to the mass of the selected
observation module (e.g., 1-meter NQ core, 1-meter HQ core, 1-meter half HQ core, etc…). If this
mass is one or several orders of magnitude too small in order to include a sufficient number of
coarse gold particles, Poisson skewness takes place. Ignoring this problem can lead to a huge
sampling error, and negative biases in ore reserves evaluations.
The Fundamental Error

Immediately following the first comminution of a solid core sample, this error is the direct effect of
small-scale Constitution Heterogeneity caused by differences between individual fragments in the
immediate neighborhood of where a sample is collected. In addition, a composite sample may
reflect differences between fragments collected far apart in time or space. In such a case, the
Fundamental Error would also be affected by what is called the large-scale Constitution
Heterogeneity. The variance of the Fundamental Error is a function of sample weight, top
fragment size, fragment size distribution, fragment shape, fragment density, mineral of interest
density, mineral of interest content, and mineral of interest liberation level. Careful tests are
necessary to predict and minimize the variance of the Fundamental Error. Failure to minimize the
variance of the Fundamental Error would make good sampling impossible, regardless of how
suitable the sampling equipment might be.
5
The Grouping and Segregation Error
This error is the direct effect of small-scale Distribution Heterogeneity caused by differences
between groups of fragments in the immediate neighborhood of where the sample is collected.
Therefore, the Grouping and Segregation Error is a function of the local Fundamental Error, the
amount of local segregation, and the number of increments collected in that neighborhood. Again,
a composite sample may reflect differences between groups of fragments collected widely apart
in time or space. In such a case, the Grouping and Segregation Error would also be affected by
what is called the large-scale Distribution Heterogeneity.
Often, samples taken at different places are sub-sampled and analyzed separately to assess
local trends over distance, tons, or time. In order to overcome the large-scale Distribution
Heterogeneity, it is necessary to select an appropriate sampling interval (called the basic
“stratum” of observation), and a sampling mode, either systematic (i.e., taking increments in the
middle of each stratum), random systematic (i.e., taking the first increment at random within the
first stratum, then taking all subsequent increments at the same place in the subsequent strata),
or stratified random (i.e., taking each increment at random within each stratum).
The large-scale Distribution Heterogeneity may be periodic in character, which renders a
systematic sampling mode hazardous. In such cases, the stratified random mode is by far the
safest approach. For example, a 12-minute cycle of the gold content generated by the discharge
of a SAG or Ball Mill in phase with a 12-minute sampling interval would have devastating effects
on the calculation of a material balance.
To minimize the effect of small-scale Distribution Heterogeneity, increments are collected close to
one another, such as the chutes of a riffle splitter, or the number of rotations when using a rotary
splitter. The larger the number of increments grouped together, the smaller the variance of the
Grouping and Segregation Error.
A second class of sampling errors occurs during the practical implementation of the sampling
protocol when sampling devices are not properly designed, built, used, maintained, and cleaned.
These errors are:
The Delimitation Error

The statistically correct selection of one increment to be collected as a sample requires that all
parts of the lot have exactly the same chance of being selected. Therefore, the geometric
boundary of an increment must coincide with an isotropic module of observation. Modules are
spherical for a three-dimensional object (e.g., a stockpile), cylindrical for a two-dimensional object
(e.g., a mining bench), and a complete and uniform slice for a one-dimensional object (e.g., a
flowing stream). As a result of omnipresent gravity generating transient segregation, any
boundary deviation from the ideal module generates a non-constant bias. For example, it is not
rare to find that a blasthole sample represents half of an active mine bench and part of the next
bench, generating total havoc in ore grade control. This error can become significant at the mill
unless correct cross-stream samplers are used.
The Extraction Error

As the sampling tool contacts the material to be sampled, all material inside the isotropic module
of observation, or every fragment with its center of gravity inside that module, must be perfectly
recovered. Any deviation from that behavior generally results in an incremental recovery loss.
Sampling devices that are poorly designed, built, used, maintained, and cleaned result in a
deviation from the rule of center of gravity and generate a non-constant bias (e.g., diamond core
recovery loss, an auger systematically rejecting coarse fragments, too narrow a cutter for a cross-
stream sampler). The “Plucking Effect” during drilling is part of the Extraction Error.
The Preparation Errors

Preparation processes applied to the increment or to the sample, such as crushing, grinding,
pulverizing, drying, screening, and packaging, can introduce a loss, contamination, or an
alteration of the physical or chemical integrity of the sample (e.g., the cyclone of a reverse
circulation drilling machine while eliminating most of the fines from the sample can introduce a
large bias).
6
The Weighting Error
Increments must be proportional to the stream flow rate for a one-dimensional stream, and to the
thickness of a two-dimensional object. Any substantial deviation from proportionality can
introduce a bias.
From time to time we will refer to these various types of sampling errors in the report, therefore
the reader can come back to this section and read the definition.
THE FUNDAMENTAL ERROR FOR LIBERATED GOLD
In any property loaded with coarse gold, it is very easy to liberate the gold as we crush the ore, or
samples, finer and finer. Therefore, it is essential to be able to quickly calculate what the variance
of the Fundamental Error is for liberated gold. A reliable model was derived a long time ago. Let’s
make a summary of it.
The Fundamental Error (FE) is the direct effect of the Constitution Heterogeneity of a lot (CHL),
which is expressed as follows:
CH L = N F ∑
[ai − a L ]2 M i2
i a L2 M L2
where NF is the total number of fragments F in the lot L, ai is the gold content of one fragment,
a L is the unknown true gold content of the lot, Mi is the mass of one fragment, and ML is the mass
of the lot. All masses are expressed in grams. All contents are dimensionless, expressed as part
of one.
CHL is a relative, dimensionless variance. This formula is complete and does not contain any
approximation or assumptions. It is a very important starting point in the Sampling Theory. To
eliminate the task of estimating NF, a new, more pragmatic term IHL called the Constant Factor of
Constitution Heterogeneity is defined:
IH L = CH L
ML [a − a ] M i2
= CH L M i = ∑ i 2 L
2
NF i aL M L
In order to estimate IHL in a practical way, the lot may be divided into a number of size fractions
and density fractions. The estimate of IHL then becomes:
Est.IH L = ∑ Vα ∑ λ β
[a αβ ]
− a L M Lαβ
2
[1]
α β a L2 M L
where Vα is the average volume of one fragment in a given size fraction α, λβ is the density of a
given density class β, aαβ is the average gold content of fragments in the size-density fraction
Lαβ, and MLαβ is the mass of the size-density fraction Lαβ.
This is the reference formula. It is complete, and carries no assumptions. In order to estimate IHL,
it is possible to perform a complete size-density analysis on a representative composite from a
given geological unit. Such a test is well documented in Gy’s work, but it is cumbersome and very
expensive. Approximations can be made with two assumptions, which, in combination, lead to a
more practical approach.
7
• Assumption 1: Experience shows that the gold content aαβ varies much more from one
density fraction to the next than from one size fraction to the next. Therefore, in equation
[1] a β is substituted for aαβ . This assumption is almost always true.
• Assumption 2: The study of a large number of real cases shows that the proportion
MLαβ /MLβ does not vary from one density fraction to the next in a manner that would
significantly alter the estimation of IHL. Therefore, in a simplified test, it is assumed that
MLαβ/MLβ can be replaced by their average MLα/ML, which gives
MLαβ = MLβMLα /ML.
Now, IHL is estimated as follows:
⎡ M
Est.IH L = ⎢∑ Vα Lα
⎤⎡ [ 2
]
a β − a L M Lβ ⎤
⎥ ⎢∑ λ β ⎥ [2]
⎣α ML ⎦ ⎣⎢ β a L2 M L ⎥⎦
This is the formula that is used for conventional gold deposits where the gold does not easily
liberate. For your properties with coarse gold this approach is inappropriate.
The above equation leads to case #2 listed in the executive summary, on page 4 of this report. In
the case of coarse gold we don’t really need it. The reason I mention it is because everybody
around the world believes this is the only solution: They know nothing about the Sampling
Theory.
Cases where Gold is Liberated
In cases where most of the gold reports to size fractions coarser than 80 microns, it is likely that
the fine pulverization performed with laboratory mills will have liberated the gold. Alluvial gold
would also be included in this category. Assumption 1 made earlier is still valid, while Assumption
2 becomes weak. Therefore, equation [2] can be restated as follows:
(a − a L ) M Lαβ
2
IH L = ∑ f α d α ∑ λ β
3 β
[3]
α β a L2 M L
By definition the gold is liberated, therefore the shape factor is a function of the density, thus:
(a − a L ) M Lαβ
2
IH L = ∑ d α ∑ f β λ β
3 β
[4]
α β a L2 M L
Developing this relationship for the density class λg of the gangue and for the density class λAu of
the gold, and calling ε the infinitesimal gold content of the gangue:
⎡ (ε − a L )2 M Lαgangue (a Au − a L )2 M LαAu ⎤
IH L = ∑ d α ⎢ f g λ g
3
+ f Au λ Au ⎥ [5]
α ⎣⎢ a L2 M L a L2 M L ⎦⎥
Obviously, the first term of the sum is negligible when compared to the second term.
Furthermore, a Au = 1 by definition, and a L is usually very small. Therefore equation [5]
simplifies as follows:
8
3 ⎡ λ Au M LαAu ⎤
IH L = d Au ⎢ f Au ⎥ [6]
⎣ a L2 M L ⎦
By definition:
M LαAu
= aL
ML
Thus, the very useful simplified formula is obtained:
λ Au
IH L = f Au g Au d Au
3
[7]
aL
where fAu is the shape factor of gold, gAu is the gold particle size distribution factor, dAu is the
largest size of the gold particles defined as the size opening of a screen that would retain 5% of
the total gold content.
If fAu = 0.2, gAu = 0.25, and λAu = 16 (in practice native gold often alloys with other metals), useful
sampling nomographs can be calculated with the following formula:
⎡ 1 1 ⎤ 0 .8 3
S FE
2
=⎢ − ⎥ d Au [8]
⎣ M S M L ⎦ aL
This is the formula you need to solve case #3 listed in the executive summary on page 4 of this
report if we assume crushing and pulverizing succeeds to break natural gold clusters. Remember,
pulverizing cannot and will not comminute coarse gold particles. Increasing the pulverizing time
too long can only result in loosing the coarse gold by smearing, which would lead one to believe
the sample is homogeneous, which would be an unfortunate illusion.
The special case of the In Situ Nugget Effect
The geological model may under-estimate gold contents and especially ore reserves if the In Situ
Nugget Effect is not well understood: We may wonder how such a thing can happen after all the
good Geology and Geostatistics that have been invested.
The quantification of the variance S NE
2
of the In situ Nugget Effect NE can be calculated by using
equation [8] rewritten a slightly different way:
⎡ 1 1 ⎤
S NE
2
=⎢ − ⎥ f M g M cM d M
3
M
⎣ S M L ⎦
where:
M S is the mass in grams of the basic core module of observation (e.g., 17-Kg 2-meter HQ core,
or a 10-Kg 2-meter NQ core sample).
9
M L is the mass in grams from the surrounding basic ore block within which only one sample of
1
mass M S has been collected. Usually, the term is totally negligible when compared to the
ML
1
term , and can be conveniently removed from our calculations every time M L ≥ 10 M S .
MS
f M is the gold shape factor, around 0.2.
g M is the gold particles size distribution factor, around 0.25 for in situ gold particles.
c M is the mineralogical factor of gold. For a gold content smaller than 10% , it is calculated with
λM
the following formula c M = where λM is the density of in situ gold and a L is the expected
aL
gold content expressed as part of one.
d M is the size in centimeter of a single gold particle equivalent to the total gold content present
within a local cluster of the many gold particles observable either in some core samples, or better
on the walls of an open pit or along an underground tunnel.
In the following material, I made the assumption there is no clustering effect at Black Fox,
which is a very optimistic assumption. Results from the tests from Phase #2 may clarify
this issue.
CALCULATION OF SAMPLING NOMOGRAPHS FOR THE BLACK FOX PROJECT
The following nomograph (See figure 1) is set for a sampling error no larger than ±15% relative,
an absolute maximum beyond which gold assays would be highly skewed toward a too low
grade.
• To account properly for 0.06-cm gold particles, a 6950-g sample needs to be assayed
entirely, through a small gravity concentrator. A diamond core sample can provide
enough material for that.
• To account properly for 0.15-cm gold particles, a 109-Kg sample needs to be assayed
entirely, through a small gravity concentrator. A diamond core sample cannot provide
enough material for that. A reverse circulation sample may provide enough material for
that. A blasthole sample will provide enough material for that.
10
grade.
entirely, through a small gravity concentrator. A diamond core sample cannot provide
enough material for that. A reverse circulation sample provides enough material for that.
11
Sampling requirements for 5.98 g/t plant grade control efficiency
grade.
entirely, through a small gravity concentrator. A 3-meter HQ diamond core sample can
12
provide enough material for that. A reverse circulation sample provides enough material
for that.
Sometimes the average gold grade may get much higher, such as 10 g/t. Then the In Situ Nugget
Effect NE and the Fundamental Error FE become smaller. However, there is a subtlety there: You
do not make important ore grade classification decisions on the basis of the possible average
grade; you make such decisions on the basis of a pre-selected cutoff grade, which is obviously
much lower, and very vulnerable to NE and FE: Keep this in mind very carefully. You make the
assumption that the classification around a pre-selected cutoff grade is successful in order
to provide a given average ore grade.
The following tables show a summary of the necessary number N of 2-meter diamond core
samples required to obtain a necessary sample mass to have a reasonable chance of including
local gold clusters where they are supposed to account for them: RC samples and blasthole
13
samples are all capable to fulfill the necessary sample mass requirements. HQ core samples
must be composited in order to fulfill sample mass requirements when gold particles up to 0.15
cm are present.
Table 1. Necessary number of field samples to process entirely through

a mini-gravity circuit to account for 0.15-cm gold particles.
Basic mass of N at 1.105 g/t N at 2.8 g/t N at 5.98 g/t

observation
2-m ½ PQ core
or 13-Kg 8 3 2
2-m full PQ core

or 26-Kg 4 2 1
2-m ½ HQ core
or 7.0-Kg 16 6 3
2m full HQ core
or 14-Kg 8 3 2
2-m ½ NQ core
or 5-Kg 22 9 4
2-m full NQ core

or 10-Kg 11 4 2
50-Kg RC samples 2 1 1
109-Kg blasthole 1 1 1
samples
14
Table 2. Necessray number of field samples to process entirely through
a mini-gravity circuit to account for 0.06-cm gold particles.
Basic mass of N at 1.105 g/t N at 2.8 g/t N at 5.98 g/t

observation
2-m ½ PQ core
or 13-Kg 1 1 1
2-m full PQ core

or 26-Kg 1 1 1
2-m ½ HQ core
or 7.0-Kg 1 1 1
2m full HQ core
or 14-Kg 1 1 1
2-m ½ NQ core
or 5-Kg 2 1 1
2-m full NQ core

or 10-Kg 1 1 1
20-Kg RC samples 1 1 1
20-Kg blasthole 1 1 1
samples
• The unequivocal conclusion is that many blocks may show below cutoff gold grade, and yet
be very attractive ore blocks.
• With diamond core drilling, you could perform good structural geology, however, as far as the
estimation of the gold grade is concerned, you did not stand a chance to account for gold
particles up to 0.15 cm; up to 0.06 cm is much easier, assuming you process samples
entirely in a mini-gravity circuit using the proper weight as suggested in nomographs.
• RC drilling had a much better chance to include gold clusters where it was supposed to, and
this is the main reason why RC drilling may show more gold. There are other reasons
we will review later in this report, such as the plucking effect.
• However, and this is where things may get a whole lot worse, this is only the first hump of the
Poisson skewness. For all samples assayed using only a 30 or 50-gram analytical
subsample, results are invalid and too low most of the time: Nobody can survive the negative
effects of a double humped Poisson distributed database: Unless, the deposit is so good that
it will be forgiving enough to pass positive feasibility.
A GOLD DEPOSIT CAN SURVIVE NONSENSE
Very often, out of fear, companies raise so many hurdles to their coarse gold deposits that
survival is only possible with very good deposits, and sometimes only with world-class deposits.
The list of negative steps is as follows:
15
1. Original field sample mass is too small: Under-estimation #1
2. Mass of sample assayed is too small: Under-estimation #2
3. Some of the high grade is chopped: Under-estimation #3
4. Correcting factors are applied to account for possible dilution: Under-estimation #4
5. Naïve polygonal grade control is applied: Future massive misclassification
6. High economic cutoff grades that will never work are applied: Future massive
misclassification
7. Low-grade stockpiles absorbing grade control mistakes are not used, believing they are
only an unnecessary additional inventory expense: Future losses of financial
opportunities…
The list could go on and on. Any deposit capable to survive such assassination must indeed be a
very good deposit.
RECOMMENDED TEST TO VALIDATE THE EXISTING DATABASE USED FOR A POSSIBLE

FEASIBILITY STUDY
For the following test, called Phase #2 test, I used a compromise between information
given in tables #1 and #2 in order to keep the test simple and pragmatic enough.
Obviously, results will be halfway between what you known now and the ultimate truth.
Select 10 existing diamond core or RC holes spread on several cross sections of the major
mineralization or main geological units. Along each hole, within mineralization, select at random
ten 4-meter long intercepts. Number of samples and sample lengths can change: We could
debate this together (i.e., Apollo Gold, MDA, and FPSC).
Now, you have selected 400 1-meter intercepts. Depending on laboratory proposals, you may
produce 100 4-meter long samples (14-Kg cyanide leach), or 200 2-meter samples (7-Kg cyanide
leach). You decide on this issue. However, if you choose the second one, you should keep two 2-
meter samples side by side (i.e., consecutive), so I can reproduce the behavior of a large 14-Kg
sample by compositing both results.
If only half NQ core samples are available, use the same approach, using ten 6-meter long
intercepts, until you get the necessary 14-Kg sample mass.
The recommended procedure is as follows:
1. Dry the samples at 110oC for 12 hours.

2. Crush to roughly minus 0.3 cm.
3. Pulverize the entire sample to roughly minus 150 microns, in stages if necessary. Do not
over grind to prevent gold losses by smearing.
4. Weigh the sample and record the weight.
5. Gravity concentrate the pulverized material through a Knelson concentrator or equivalent
and table or hand pan the Knelson concentrate; weigh and record the weight of the
concentrate.
6. Assay the concentrate to extinction (all goes into the assay pot.).
7. Combine concentrate tails for cyanide leach.
8. Leach at 45% solids, 24 to 48 hours at 1 g/l NaCN and pH 11 or until fully leached
(precautions should be taken to ensure that the leach is not cyanide-starved; keep track
of CN added and consumed).
9. Filter, wash, join wash to solution, and measure the total volume of solution.
10. Assay the gold content in the leached solution.
11. Dry and weigh the sample, and record the weight.
12. Assay the filter cake using two 30-gram fire assays.
16
13. Calculate the weighted average total gold content for Knelson concentrate, leached
solutions, and filter cake.
14. Provide all assays and all weights in raw form as well as recombined for a total assay.
15. Provide a report detailing all steps of the process including subsampling procedures,
additives, measurements, analytical methods, equipment used, etc…
CONCLUSIONS AND RECOMMENDATIONS
• The existing database generated by conventional sampling, subsampling, and fire assay is
not capable to assess the gold content of geological units at the Black Fox gold project.
• The above calculations, approximate and preliminary in nature, but based on the provided
information, are good enough to establish beyond any possible doubt that only the use of a
gold concentrator will allow the company to properly and accurately assess the natural
resources of the various geological units at the Black Fox gold project.
• The above information is sufficient for top management to make a clear commitment about
changing strategy completely, and use large samples to be entirely processed through small
gold concentrators.
• The above nomographs would suggest that diamond core drilling is too small diameter to
provide the necessary sample mass.
¾ The test recommended for Phase #2 should provide all the necessary information to support
a more effective feasibility study and also decide about necessary sampling protocol for
future ore grade control.
ANOTHER PROBLEM: THE “PLUCKING EFFECT”
Diamond core samples can show some “Plucking Effect”, which further complicates good gold
grade estimations. It is worthwhile to explain what this problem is in this report.
The increment Extraction Error
The extraction Error in sampling is responsible for many annoying biases. The Extraction Error
could have been called the Recovery Error, more familiar to geologists, [1]. As the sampling tool
contacts the material to be sampled, all material inside the isotropic module of observation, or
every fragment with its center of gravity inside that module, which is a cylinder, must be
recovered in the sample, and vice versa. Any deviation from that behavior generally results in an
increment recovery loss, or gain. Again, as a result of omnipresent gravity, combined with a
sampling device poorly designed, built, maintained, cleaned, and used, any deviation from that
rule generates a non-constant bias. Drilling machines are very vulnerable when poor sample
recovery occurs, always generating a non-constant extraction bias. But, as part of the extraction
bias, there is a subtler phenomenon that takes place. It can be called the “Plucking Effect”, and it
has escaped the attention of many geologists around the world.
Definition of the “Plucking Effect”
In the following discussion, I assume the mineral of interest is gold, electrum, quartz containing
gold, or sulfides containing gold. Gold, silver, electrum, quartz or sulfides containing them, in a
given geological unit may occur as disseminated little grains, as tiny veinlets, or as more massive
veins. As a diamond drilling machine cuts its way through the mineralized area, a slick core
sample showing full account of everything is expected: Reality is different.
Figure 4 shows the “Plucking Effect” generated by a diamond core drilling machine, while figure 5
shows what happens with a Reverse Circulation drilling machine.
17
• As a result of the inward effect illustrated in figure 4, diamond core drilling always shows
slightly lower gold contents than it should, and there is nothing you can do about it.
• As a result of the outward effect illustrated in figure 5, Reverse Circulation drilling always
shows slightly higher gold contents than it should, and there is nothing you can do about
it.
Attempt to quantify the “Plucking Effect”
As further illustrated in figure 6, let’s define a few terms:
aL the true gold content of the rock (g/t),

aC the gold content from diamond core drilling (g/t),
aR the gold content from RC drilling (g/t),
dL the average observed size of the quartz grains, or quartz veinlets thickness (cm), containing
the gold,
RC the radius of the diamond core (cm),
RCeff the effective radius of the diamond core (cm),
RR the radius of the RC hole (cm),
RReff the effective radius of the RC hole (cm),
H the length of the drilling intercept (cm),
D the density of the rock (g/cc).
In situ Ideal recovery Plucking Effect
Figure 4. “Plucking Effect” generated by a diamond core drilling machine
18
For all practical purposes, we assume that:
RCeff = RC − 0.5d L
RRe ff = R R + 0.5d L
The true weight WC of the sample given by core drilling is:
WC = DhπRC2
The effective weight WCeff of the sample given by core drilling is:
WCeff = Dhπ [RC − 0.5d L ]

2
The correcting factor CC for core drilling is:
WC RC2
CC = =
WCeff [RC − 0.5d L ]2
19
In situ Plucking Effect
Figure 5. “Plucking Effect” generated by a Reverse Circulation drilling machine
RC RR
RCeff
dL
RReff
Figure 6. Definition of terms
The true weight WR of the sample given by RC drilling is:
20
WC = DhπRR2
The effective weight WReff of the sample given by RC drilling is:
WCeff = Dhπ [RC + 0.5d L ]

2
The correcting factor CR for RC drilling is:
WR RR2
CR = =
WRe ff [RR + 0.5d L ]2
Illustration examples
A HQ core has a diameter of 6.35 cm. The gold content from the core analysis is 2.29 g/t. The
average size of quartz grains containing the gold is 0.2 cm. What should the true gold content
be?
CC =
RC2
=
[3.175]
2
= 1.07
[RC − 0.5d L ]2 [3.175 − 0.10]2
The true gold content is 2.29 g/t x 1.07 = 2.45 g/t.
A RC hole has a diameter of 12 cm. The gold content from the analysis is 2.29 g/t. The average
size of quartz grains is 0.2 cm. What should the true gold content be?
CR =
RR2
=
[6.00] = 0.97 2
[RR + 0.5d L ] [6.00 + 0.10]2

2
The true gold content is 2.29 g/t x 0.97 = 2.22 g/t
• These calculations are approximate, but they clearly show the problem is a substantial
one that deserves attention, especially for small diameters, and may explain part of
many conciliation problems between the geological model and the plant.
• From close observations of the Sao Francisco gold ores, it seems that quartz, sulfides,
and gold are good candidates for substantial plucking.
¾ When the geologist prepares the log of core samples, taking notes for many relevant
observations, he should indicate if substantial plucking of minerals containing gold takes
place. You can roughly tell by passing a finger on the surface of the core and feel for the
tiny pits. Of course, there is no way to tell for RC drilling: There are a lot of things you
cannot tell with RC drilling!
21
RECOMMENDED REFERENCES
[1] F.F. Pitard - "Pierre Gy's Sampling Theory and Sampling Practice". Written for Short courses.
Published by CRC Press, Inc. 2000 Corporate Blvd., N.W. Boca Raton, Florida 33431. Second
edition in 1993.
[2] C.O. Ingamells and F.F. Pitard - "Applied Geochemical Analysis". C.O. Ingamells and F.F.
Pitard. Wiley Interscience Division, John Wiley and Sons, Inc., New York, 1986. 733 pages
textbook.
[3] F.F. Pitard - "Exploration of the Nugget Effect". Geostatistics for the Next Century: An
International Forum in Honour of Michel David's Contribution to Geostatistics, Montreal, 1993.
Edited by Roussos Dimitrakopoulos, McGill University, Kluwer Academic Publishers, Boston.
[4] F.F. Pitard - “A Strategy to Minimise Ore Grade Reconciliation Problems Between the Mine and
the Mill”, Mine to Mill 1998 Conference, Brisbane, October, 11-14 1998. The Australian Institute of
Mining and Metallurgy.
[5] F.F. Pitard - “Practical and Theoretical Difficulties When Sampling Gold”, Mineral Processing
Plant Design, Control and Practice Conference, Vancouver, BC, Canada, October 20-24, 2002,
Society for Mining, Metallurgy and Exploration, Inc. and Canadian Mineral Processors of the
Canadian Institute of Metallurgy.
22
Summary of Results from Recommended Phase 2 Looking at the Gold Content of Very Large
Samples
May 31, 2006

FRANCIS
PITARD
SAMPLING
CONSULTANTS
May 31, 2006
From: Mr. Francis F. Pitard

Francis Pitard Sampling Consultants, LLC
14800 Tejon Street
Broomfield, CO 80020, USA
Phone: 303-451-7893
Fax: 303-280-1396
E-mail: fpsc@aol.com
To: Mr. Ryan Lougheed

Apollo Gold, Inc.
Dear Ryan:
This letter is a quick summary of my observations using results from the recommended phase #2 looking
at the gold content of very large samples.
The test carries interesting information though it is biased for the following reasons:
• Too few samples were processed: 53 instead of the recommended 200. We knew it was only a
preliminary test.
• Very high grade was mixed with very low grade: It is all right to do this as long as the material
belongs to the same geological unit.
A quick review of the 5 blanks leads to the following observations:
• You did not assay your blanks before submitting them to the laboratory, so anyone may argue
they may not have been good blanks to begin with. Or, at least, you did not disclose what the
gold contents were.
• Making the assumption these gold contents should have been very low, I don’t have a problem
with sample #21, 30, and 51. It is border line with sample #43.
• A substantial gold contamination is noticed on sample #10, suggesting the database from large
samples gravity/cyanide leach is not reliable below 1 g/t, which is truly unfortunate as a lot of
extra potential ore was expected in this grade category.
Figure 1 shows results in a pragmatic way using a Relative Difference Plot, comparing results from
gravity/cyanide tests of large composites versus the original estimates from regular fire assays. A seven-
point Moving Average is superimposed to detect conditional biases if any. Pairs on the horizontal axis are
sorted by increasing gold contents. Key gold contents showing transition zones are highlighted for
convenience. This graphic does not contain the blanks.
The following facts can be observed:

• Up to about 1 g/t, large samples find much more gold. Unfortunately one blank turned out to be
very bad and raised a doubt on the real origin of such gold. This is a very disappointing statement
to make.
• Since only one blank out of five shows the problem we may still conclude the large samples show
more real gold, however I suggest extreme caution about this dream.
• Between 1 g/t and about 12 g/t nothing much happens and both sets of gold results are more or
less in agreement. I think this is the good news for your original database used for the feasibility
study.
• It is indeed rather disappointing we don’t show much more gold in the medium range of gold
grades using very large samples. Obviously to demonstrate such a thing beyond any doubt we
need many more samples. It is my view we should find more gold.
• Above 12 g/t, less gold is found with large samples, which clearly shows these high values
selected within the database are the result of high skewness and such gold grade at the places
where they were generated do not exist. This was one of the main objectives of the test,
demonstrating that high gold ore blocks do exist, however they may not be at the place
you may think they are: This suggests extreme caution about the selection of very high
cutoff grades for the underground project.
• Looking at different families of materials as rightly suggested by Mr. Neil Prenn would require the
processing of the 200 samples I originally suggested: It cannot be done and supported by good
statistics with only 53 samples. What we are doing there is just starting the ball rolling to many
questions about the true natural resources of the project.
Figure 1

Where do we go from there? I have the following suggestions but you have to put them in the right
context of what you know about your project.
¾ Be very concerned about the contamination of low-grade material with high-grade material that
can lead to false economics for the low-grade material. Our bad experience in this preliminary
test is a strong warning.
¾ Proceed with the 147 other tests: I originally suggested 200, but only 53 were performed.
¾ If the amount of rejects is not sufficient to perform these additional tests, I think we have a
problem leading to necessary additional drilling.
¾ This small initial test involving only 53 samples was an eye opener suggesting extreme caution
on how to do such test if you decide to proceed with the additional 147 samples, as you should.
At this stage it is all we can do with the existing results. Take your time to digest this information that truly
tells us we should do more.
I look forward to working with you again.
Best regards,
Francis F. Pitard


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MINE DEVELOPMENT ASSOCIATES

MINE ENGINEERING SERVICES

APOLLO GOLD CORPORATION

Neil B. Prenn, P. Eng.

210 South Rock Blvd.

1.0 EXCUTIVE SUMMARY ............................................................................................................... 1

2.0 INTRODUCTION AND TERMS OF REFERENCE................................................................... 26

3.0 RELIANCE ON OTHERS ............................................................................................................ 30

4.0 PROPERTY DESCRIPTION AND LOCATION......................................................................... 31

5.0 ACCESS; CLIMATE; LOCAL RESOURCES; INFRASTRUCTURE; AND

210 South Rock Blvd.

7.0 GEOLOGIC SETTING ................................................................................................................. 46

8.0 DEPOSIT TYPE............................................................................................................................ 53

10.0 EXPLORATION ........................................................................................................................... 56

11.0 DRILLING .................................................................................................................................... 59

12.0 SAMPLING METHOD AND APPROACH................................................................................. 64

13.0 SAMPLE PREPARATION, ANALYSIS, AND SECURITY...................................................... 71

13.4.4.1 Metallic Check Assays ....................................................................... 77

14.0 DATA VERIFICATION ............................................................................................................... 84

15.0 ADJACENT PROPERTIES.......................................................................................................... 85

16.0 MINERAL PROCESSING AND METALLURGICAL TESTING ............................................. 87

17.0 MINERAL RESOURCE ESTIMATE ..........................................................................................99

18.0 MINERAL RESERVE ESTIMATE ...........................................................................................115

19.0 OTHER RELEVANT DATA AND INFORMATION............................................................... 130

20.0 INTERPRETATION AND CONCLUSIONS ............................................................................131

21.0 RECOMMENDATIONS ............................................................................................................ 133

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

22.0 ADDITIONAL REQUIREMENTS FOR TECHNICAL REPORTS ON DEVELOPMENT

23.0 REFERENCES ............................................................................................................................ 186

24.0 AUTHOR’S CERTIFICATE ......................................................................................................189

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

Table 18.2 Pit Optimization Results.....................................................................................................125

Figure 7.3 Typical Cross Section 10025E .............................................................................................50

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

1.0 EXCUTIVE SUMMARY

210 South Rock Blvd.

Table 1.1 Historic Black Fox Production

Totals 1,098.8 5.97 210.8 97.14%

1.2 Geology and Mineralization

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

1.3 Drilling and Sampling

Table 1.2 Black Fox Property Drill Summary

Company Period Type Number Meters

Subtotal Surface 734 185,861.0

Exall 1996-2001 Underground 721 63,059.2

Subtotal Underground 1,092 138,763.6

Total Black Fox 1,826 324,624.6

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

 As a result, Poisson skewness enters the database, leading to a frequent under-estimation of

1.4 Metallurgical Testing and Processing

 To varying degrees, Black Fox mineralization is amenable to gravity concentration.

 The ground mineralization exhibits favorable settling characteristics.

1.5 Black Fox Resource Estimate

Table 1.3 Mineralized Zone Domains and High Grade Cut

The interpolation passes were as follows:

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

Table 1.4 Indicated Material

Indicated 1 Indicated: 2 Total Indicated

Mine Development Associates \\Neil\projects\Apollo Gold\Black_Fox_Dec_2005\2006_43-101report\Technical Report 2006_final_.doc

As a result, Poisson skewness enters the database, leading to a frequent under-estimation of

To varying degrees, Black Fox mineralization is amenable to gravity concentration.

The ground mineralization exhibits favorable settling characteristics.

Overburden mining cost - $US 1.25 per tonne of material;

Preliminary flowsheets and mass balances;

The potential for developing underground minable reserves is considered good.

Improved control of the operation, operating cost, and gold recovery.

Additional geotechnical testing of the overburden in select areas

Ore and waste rock strength testing;

Geotechnical and Geological mapping of the underground workings;

Geologic mapping of the underground to compare to existing maps;

Determination of dewatering requirements;

Condemnation drilling in tailings and mine rock waste area;

Waste rock characterization.

Bottle roll characterization, with thin section mineralogy;

Semi-autogenous grinding amenability tests (Lakefield quote - CDN $72,500);

Power supply review

Water supply review