GRAND u RESOURCES CORPORATION

CLEAR LAKE PROPERTY FA ULKENHAM LAKE AREA

REDLAKE MINING DIVISION ONTARIO

REPORT ON MAGNETIC AND HORIZONTAL LOOP E.M. SURVEYS

- by - 2 .

Colin Bowdidge, Pb.D., P.Geo.

October 2004

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PROVINCIAL RECOR ,NG OFFICE - SUDBU Y

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TABLE OF CONTENTS

INTRODUCTION ............................................................. 1

PROPERTY, LOCATION AND ACCESS .......................................... 1

HISTORY AND PREVIOUS WORK .............................................. 2

GEOLOOY .................................................................. 2

2004 PROGRAM ..........•................................................... 3

Line Cutting ............................................................ 3

Horizontal Loop EM Survey ............................................... 3

Magnetic Survey ........................................................ 4

SURVEY RESULTS ........................................................... 4

CONCLUSIONS AND RECOMMENDATIONS .................................... 5

REFERENCES ............................................................... 7

FIGURES

Figure 1: Location Map

Figure 2: Regional Geology

Figure 3: Claim Map with Grid and Anomalies

Figure 4: Geology with Grid and Anomalies

PLATES (in rear pocket)

Plate 1: Horizontal Loop Survey Data Postings, 1 :2,500

Plate 2: Horizontal Loop Survey Profiles, 1 :2,500

Plate 3: Magnetic Survey Data Postings, 1:2,500

Plate 4: Magnetic Survey, Total Field Contours, 1 :2,500

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INTRODUCTION

This report presents the results of magnetic and horizontal loop electromagnetic surveys carried out

during 2004 on the Clear Lake property of Grandcru Resources Corporation. The work was

commenced during the spring of2004 but had to be abandoned because of poor snow, ice and slush

conditions. It was completed during September 2004.

PROPERTY, LOCATION AND ACCESS

The property consists of five claims comprising 43 claim units, as detailed in the following table:

CLAIM SUMMARY:

Claim No. No. Units r;:ording date Expiry date Work Req. Reserve

1185210 8 2003.08.26 2005.08.26 3200 0

1185211 15 2003.08.26 2005.08.26 6000 0

1185212 12 2003.08.26 2005.08.26 4800 0

1185232 2 2003.08.26 2005.08.26 800 0

1185233 6 2003.08.26 2005.08.26 2400 0

Source: MNDM Mining Claims Information (MCI)

The claims are held by Perry English, and are under option to Grandcru Resources Corporation.

They are situated in the Faulkenham Lake area, 15 kilometres south-southwest of the town of Red

Lake and 7 kilometres southeast of the small community ofStarratt-Olsen, which is at the end ofthe

paved road running southwest from Red Lake to Madsen.

Access to the property during the summer months is by float-equipped light aircrafit from Red Lake.

In winter, a snowmobile trail can be used, that leads from the end of the road at Starratt-Olsen leads

to a cabin on Bug Lake (now locally referred to as either Clear Lake or Crystal Lake), just northwest

of the property.

Figure I shows the location of the property.

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mSTORY AND PREVIOUS WORK

In 1976, Selco Mining Corporation carried out horizontal loop (EM-I 7) and magnetic surveys over

an area that corresponds approximately to the western half of the 2004 grid (Thorsen, 1976). The

survey defined conductor A (as shown on the naps in this report) and shows conductor B as a weak

feature.

In 1985, Golden Terrace Resources Corp. carried out an airborne EM and magnetic survey, using

the Aerodat system, over the Dixie Lake area, including the present property (Podolsky, 1985).

Numerous conductors were identified; they are shown on figures 3 and 4.

The map of Thurston and Paktunc (1985) shows a diamond drill hole in the approximate area of

conductor A (see fig. 4). No record of this drill hole was found in the Red Lake assessment files.

A 1946 report by the Red Lake Resident Geologist (Thomson, 1946) describes a visit to the Bug

Lake area with a prospector named Cecil Alcock. Mr. Alcock had reported located a gold-stibnite

occurrence in the 1930s. A number of old pits were found "near the northeast end of a small lake

and nearby swamp", but the showing itself was not relocated at the time.

GEOLOGY

The property lies in the Uchi subprovince of the Canadian Shield. It covers part of a narrow (1 km

or less) greenstone belt that is one of the branches from the west end of the Confedl::ration Lake be It.

Figure 2 shows the regional geological setting of the property.

The area was mapped on a reconnaissance basis by Thurston & Paktunc (1985). Figure 4 shows the

geology taken from their map. In the centre of the property the southern half ofthe belt consists of

mafic volcanics, and the northern half consists of clastic metasediments. At the west end of the

property a wedge of mafic volcanics appears on the north side of the belt, and at the east end of the

property the metasediments appear to change laterally into felsic metavolcanics.

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Fig. 2: R g ional Geology and Tectonic Units of tho Red Lak -

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Thomson (1946) reports a number of sulphide occurrences in granitoid or gneissic rocks, in old pits

"near the northeast end of a small lake" east or southeast of Bug Lake. These w(!re found when

looking for the Alcock gold-stibnite showing. He also reports that "at the west end ofthe V-shaped

lake fprobably the lake that the 2004 baseline runs along] plentiful angular boulders up to 4 feet by

3 feet by 2 feet of hard white siliceous altered rock with pyrite occur".

2004 PROGRAM

Line Cutting

A 3000 metre long base line was laid out with azimuth 083 degrees (relative to VTM north). Cross

lines were turned off at 50 metre intervals. The entire grid was cut in winter; those lines at the

eastern end of the grid that were surveyed in September were cleaned out because of heavy

undergrowth, which was an impediment to the horizontal loop survey. The line cutting contractor

was Top Notch Exploration (now Ackewance Exploration and Services) of Red Lake .

Horizontal Loop EM Survey . I~ 8 '~ )

The electromagnetic survey was carried out using an Apex Parametrics Maxmin II horizontal loop

system. Cable length was 100 metres and the frequencies used were 444 Hz and 1777 Hz. Readings

were taken at 25 metre intervals. Coplanarity ofthe coils was achieved using the standard method

of measuring the slope between each station and the next with an inclinometer and calculating an

average slope for the four station intervals making up the length of the cable for each reading

position. The transmitter and receiver coils were tilted by the amount ofthis slope.

Receiver operator was Dusan Dmitrovic, and transmitter operators were Ted Cox (in spring) and Joe

Brandstrom (in September). Data processing was performed by the writer using Geosoft® software.

The results of the survey are presented on Plate 1 (data postings) and Plate 2 (profiles with

interpreted conductors). Apparent conductances at 1777 Hz were calculated using standard models

for thin sheet conductors, and are shown on Plate 2.

Magnetic Survey

The west part of the grid (from line 0 to line] 700W) was carried out in the spring using an EDA

Omni Plus system. The east part of the grid, from line 0 to line 1300E, was surveyed in September,

using a Scintrex ENVI magnetometer. Both instruments store readings for the duration of a day's

surveying, and the data can be dumped each day into a computer. Base stations were used during

both phases of the survey for correction of diurnal variations. In September, line 0, which had been

surveyed in the spring, was resurveyed to verity that the new instrument gave readings consistent

with those of the earlier survey. No adjustments were required.

The magnetometer operator was Dusan Dmitrovic. Magnetic data are presented on Plate 3 (total

field data posting) and Plate 4 (total field contours with HLEM conductors superimposed).

SURVEY RESULTS

The magnetic survey shows a distinct group of more or less linear, discontinuous anomalies that

coincide, on a gross scale with the conductive trend that crosses the grid. The strongest of these

anomalies has a peak amplitude of2500 nT. This trend, as can be seen on figure 4, lies close to the

volcanic-sedimentary contact as mapped by Thurston & Paktunc (1985). To the south of this

trend/contact, in the volcanic terrain, the magnetic pattern is quite flat, with a few isolated magnetic

highs with amplitudes up to 1000 nT.

In the area underlain by metasediments north ofthe conductive/magnetic trend, the magnetic pattern

is much more active. There are numerous erratically distributed magnetic highs, a few of which are

linear and are presumed to be caused by fonnational units. The number and intensity of these

anomalies increase progressively from east to west.

In the northwest comer ofthe grid, presumed to be underlain by granodiorite, the magnetic pattern

is again quite flat.

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The horizontal loop survey shows four separate conductors, which line up to fonn a more or less

continuous trend along the volcanic-sedimentary contact. There is a possible structural disruption

in the vicinity of line 700W, where the magnetic-conductive trend may be offse:t by 100 to 150

metres.

Conductor A is 950 metres long, and is mostly narrow, with a section up to 60 metres wide between

lines 1200W and 1500W. Apparent conductance is between 2 and 27 siemens. There is an irregular

magnetic response, with alternating highs and lows, suggestive of concentrations of pyrrhotite.

Conductor B is 200 metres long and up to 25 metres wide, with apparent conductance of up to 23

siemens. The magnetic response again features highs and lows.

Conductor Cis 150 metres long and is up to 15 metres wide, with much lower conductance, up to

6 siemens. It has no magnetic association.

Conductor D has been traced for 1400 metres, and extends beyond the east end of the grid. It is very

weak, and conductance calculations derived from in-phase/quadrature ratios would suggest a

moderately good conductor at considerable depth, which would probably be misleading. It is

probably narrow, but the amplitudes are so low that widths cannot be reliable measured. It loosely

follows a number of magnetic anomalies, but it tends to flank them.

CONCLUSIONS AND RECOMMENDATIONS

The highlight of the geophysical surveys is the recognition of a more or less continuous magnetic

and conductive trend aligned along the contact between a (lower?) mafic volcanic unit and an

(upper?) unit of clastic metasediments. In the greenstone belts ofthe Uchi subprovince which have

a simple stratigraphy, this contact is a favourable locus for gold mineralization.

It is recommended that the grid be mapped and prospected, with particular attention paid to the

conductors and magnetic anomalies along the volcanic-sedimentary contact. An attempt should be

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made to relocate the old trenches described by Thomson (1946). The pyritic boulders at the west end

of the V-shaped lake should be easy to locate. Soil geochemistry (either conventional or MMI,

depending on the terrain) would also be a valuable exploration tool.

Further attempts might be made to locate reports used by Thurston & Paktunc (1985) to place a drill

hole on their map. It is likely that this hole was drilled by Selco, and it is further likely that, if a drill

log, or at least a hole number can be found, the core is stored in the MNDM core library at Red Lake.

They have numerous Selco drill holes for which they do not have any written record. It is probable

that Thurston & Paktunc (1985) were given access to Selco's records including data that may not

have been filed for assessment work.

Respectfully submitted,

CoHn R. Bowdidge, Ph.D., P.Geo.

31 October 2004

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REFERENCES

PODOLSKY, G., 1985. Report on Combined Helicopter-borne Magnetic, E1ectromagnetic and VLF Survey, Dixie Lake Area, Ontario for Golden Terrace Resources by Aerodat Ltd. MNDM Assessment File 52K 13NW0053

THOMSON, R., 1946. Report on a Visit to the Alcock Property. Unpublished n!port in MNDM Red Lake Resident Geologist Files.

THORSEN, K., 1976. Selco Mining Corporation, Block 150-6, Dixie Lake Area, Geophysical Report. MNDM Assessment File 52K 13NW8937

THURSTON, P.e. & PAKTUNC, D., 1985. Western Uchi Subprovince (Troutlake River Area), Madsen Sheet, District of Kenora (Patricia Portion): Ont. Geol. Surv. Map P.2857.

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