Appendix A Material Terms of Related Party Agreements (provided by David Rodli, General Counsel, Grant Hartford Corporation)

Appendix A

Material Terms of Related Party Agreements
(provided by Xxxxx Xxxxx, General Counsel, Grant Hartford Corporation)

Xx. Xxxx Xxxxx, as President, CEO, CFO and Director of Grant Hartford Corporation ("Xxxxx Xxxxxxxx") negotiated the terms of the Grant Hartford Option Agreement ("Option Agreement") with Commonwealth Resources, L.L.C. in March, 2007. Xx. Xxxxx Xxxxxxxx, the Managing Member of Commonwealth Resources, L.L.C., negotiated on behalf of Commonwealth Resources, L.L.C. The parties determined the material terms of the Option Agreement during a 25-day contemplative period, beginning on February 25, 2007 and ending on March 22, 2007, and by relying upon several factors, including but not limited to, the presence of extensive historical data on the mineral property, such as the "Garnet Project Summary" by Xxxx Xxxxxxx, of Pegasus Gold Corporation and the "Mineral Property Valuation" by Xxxx X. Xxxxxx, PhD, and a previous option agreement to the mining property and claims with Pegasus Gold Corp.

On March 22, 2007, Grant Hartford and Commonwealth Resources, L.L.C. entered into a Letter of Intent and on June 15, 2007, Grant Hartford and Commonwealth Resources, L.L.C. finalized the Option Agreement, whereby Grant Hartford would acquire an option to purchase the mineral rights to 122 unpatented and 23 patented mining claims from Commonwealth Resources, L.L.C.. The material terms whereby Grant Hartford obtained the option to purchase the Garnet Mining District mineral deeds from Grant Hartford are as follows: Xxxxx Xxxxxxxx is allowed a seven (7) year period whereby Commonwealth Resources, L.L.C. will hold the mineral rights to the property exclusively for the benefit of Xxxxx Xxxxxxxx. In order to retain the exclusive option to purchase the mineral rights for this seven (7) year period , Grant Hartford is responsible for the Bureau of Land Management assessment fees, which currently total $140.00 for each of the 122 unpatented mining claim, for a total annual payment of $17,080.00, the property taxes on each of the 23 patented mining claims, for a total annual payment of $1,362, an annual surface access lease payment of $60,000, an annual option payment of $190,000, which increases to $400,000 in year six (6) and seven (7) of the Option Agreement, the issuance of 19,000,000 shares of Grant Hartford's no par value common stock, pursuant to the Amendment to Grant Hartford Option Agreement dated January 24, 2008, and the payment of a 5% net smelter return on any ore processed during the option period within fifteen (15) days of the close of each calendar month.

A breach of the Option Agreement occurs when any obligation under the Option Agreement or the Lease is not performed. Ten (10) days from the date of the defaulting incident, Commonwealth Resources, L.L.C. may deliver the notice of default to Xxxxx Xxxxxxxx. Xxxxx Xxxxxxxx then has twenty (20) days from the date of service to cure the default before the Option Agreement is terminated. Upon termination Grant Hartford shall: ensure sufficient assessment work has been filed to hold unpatented claims through the assessment year commencing September 1 of that calendar year; Grant Hartford has 60 days to deliver to Commonwealth existing drill core samples, pulps, and copies of formal reports, and Xxxxx Xxxxxxxx must represent and warrant the accuracy and completeness of this data; Grant hartford has 180 days to remove any of Xxxxx Xxxxxxxx'x property that was placed on the site by Xxxxx Xxxxxxxx, excluding that property that must be left pursuant to the Option Agreement

or Lease; and Grant hartford has 180 days to replace any structures moved from the property.

2010 Amendment To Option Agreement

On or about June 28, 2010, Commonwealth Resources, LLC and Grant Hartford Corporation executed an amendement to their 2007 Option Agreement, the material terms of which:

			1.	Extended the end of the option period from June 14, 2014 to June 14, 2017; and
			2.	Provided that the annual option payments would continue to be $190,000.00 to and through June 15, 2014 and would increase to $400,000.00 for the June 15, 2015 and June 15, 2016 payments.

The remaining provisions of the Option Agreement continue in full force and effect.

Notice of Option to Purchase Mineral Interests

On September 25, 2008, a Notice of Option to Purchase Mineral Interests was recorded with the Granite Clerk and Recorder, whereby Commonwealth Resources, L.L.C. conferred upon Xxxxx Xxxxxxxx the right to purchase the mineral rights pertaining to the subject mining claims at any time prior to June 15, 2014, provided Grant Hartford performs all obligations as required pursuant to the material terms of the Grant Hartford Option Agreement ("Option Agreement"). The material terms as stated in the Option Agreement are as follows: The option may be exercised at any time prior to 11:59pm, June 14, 2014. Grant Hartford may enter and shall have immediate possession of the property containing the optioned mineral rights, excluding historical structures. Grant Hartford may use the property to: carry out its operations; install buildings, plants, machinery, equipment, tools, appliances and supplies; and remove up to 100 tons per day of rock, ores, minerals and metals, whereby 5% of the net smelter return on any ore processed will be paid to Commonwealth Resources, L.L.C. within fifteen (15) days of the close of each calendar month. In the event Commonwealth Resources, L.L.C.'s title is deficient, Grant Hartford may remedy the deficiency and deduct the costs and related expenses of said deficiency from the final purchase price of the Garnet Mining District mineral deeds. In order to avoid default, Grant Hartford shall complete the following material terms: Pay an annual option payment of $190,000 to Commonwealth Resources, L.L.C. on June 15 of each calendar year until June 15, 2011, on which date the option payment increases to $400,000 for the final two-year period. Grant Hartford is required to issue 19,000,000 shares of Grant Hartford's no par value common stock, pursuant to an Amendment to Grant Hartford Option Agreement dated January 24, 2008; fully and timely pay all real estate taxes and assessments on the patented claims; create and provide to Commonwealth Resources, L.L.C., a work program, which may be abandoned if it is not warranted, based on the results of previous work. Grant Hartford will hold Commonwealth Resources, L.L.C. harmless from and indemnify it for all costs of rehabilitation or reclamation of the property. At the time of completion of operations,

Xxxxx Xxxxxxxx must return structures to their original site, or another agreed-upon site on the property. Grant Hartford must provide work program results to Commonwealth Resources, L.L.C. Grant Hartford must secure and maintain adequate insurance on the property and for the workers. Additional mineral claims may be purchased by Grant Hartford within the area of interest for the mutual benefit of both parties.

The parties have agreed to execute and record a Notice Of Amended Option To Purchase Mineral Interests specifying the changes to the Option Agreement engendered by the 2010 amendment therefo.

Non-Exclusive Surface Lease Agreement

Grant Hartford must fully perform the material terms of the surface lease between the parties, which is titled "Non-Exclusive Surface Lease Agreement" ("Lease"), which was entered into by the parties on June 15, 2007. The material terms of the Lease are as follows: The Lease runs concurrently with the Option Agreement and expires at Grant Hartford's acquisition of the mineral rights. At that time, the parties shall enter into a new lease of the property, under mutually-agreeable terms and for rent of not less than the current Lease. Xxxxx Xxxxxxxx may use any structure on the property as listed in Schedule B of the Lease. Any structure constructed, remodeled, or renovated on the property is to run with the land and is to remain there for the benefit of Commonwealth Resources, L.L.C. Grant Hartford is required to maintain fire and extended coverage on all structures in use on the property and must maintain the exteriors and interiors of those structures. An annual rent payment of $60,000 per year is required, which, upon thirty (30) day notice, may convert to monthly or quarterly payments upon mutual agreement between the parties. In addition, Xxxxx Xxxxxxxx must pay all the taxes and assessments on the patented claims and pay all assessments and conduct all work required to keep unpatented mining claims in good standing with the US Department of Interior, Bureau of Land Management and State of Montana, or any political subdivision thereof. Grant Hartford shall hold Commonwealth Resources, L.L.C. harmless from liability damages or claims of damages and Grant Hartford must carry suitable liability insurance.

A breach of the Lease includes the following: If Xxxxx Xxxxxxxx fails to pay all taxes and assessments, or conduct all work on the subject claims; uses the property in a way not set forth in the Lease; fails to pay the rent payment; commits or suffers any waste that is committed in or upon the property; makes a general assignment for the benefit of creditors; makes an insolvent assignment; or files a voluntary petition for bankruptcy. In the event Grant Hartford fails to pay all taxes and assessments and perform all work on the subject claims; Commonwealth Resources, L.L.C. shall have the right, without notice, to make payments or perform the work required. This default may be cured by Xxxxx Xxxxxxxx if the Company reimburses Commonwealth Resources, L.L.C. for the full costs for completing the requirements in a timely manner. Otherwise termination of the agreement requires written notice of default to be delivered to Grant Hartford no sooner than 10 days from the defaulting event. Xxxxx Xxxxxxxx then has thirty (30) days from delivery of the default notice to cure the default in its entirety. If said cure is not completed within the thirty (30) day time

period, Commonwealth Resources, L.L.C. may reenter the property, take possession and cancel the Lease, whereby Xxxxx Xxxxxxxx forfeits all rents paid and is responsible for any damages suffered by Commonwealth Resources, L.L.C. as a result of the default.

A breach of the Option Agreement occurs when any obligation under the Option Agreement or the Lease is not performed. Ten (10) days from the date of the defaulting incident, Commonwealth Resources, L.L.C. may deliver the notice of default to Xxxxx Xxxxxxxx. Xxxxx Xxxxxxxx then has twenty (20) days from the date of service to cure the default before the Option Agreement is terminated. Upon termination Grant Hartford shall: ensure sufficient assessment work has been filed to hold unpatented claims through the assessment year commencing September 1 of that calendar year; Grant Hartford has 60 days to deliver: existing drill core samples, pulps, and copies of formal reports, and Grant Hartford must represent and warrant the accuracy and completeness of this data; Grant Hartford has 180 days to remove any of Xxxxx Xxxxxxxx'x property that was placed on the site by Xxxxx Xxxxxxxx, excluding that property that must be left pursuant to the Option Agreement or Lease; and Grant Hartford has 180 days to replace any structures moved from the property.

Amended Mining Lease/Partial Assignment of Amended Mining Lease and Acknowledgment

The owner of record of one (1) patented claim, the Free Coin, is River Terrace Estates, Inc. An Amended Mining Lease between River Terrace Estates, Inc. and Commonwealth Resources, L.L.C. provides for a lease and option to purchase the Free Coin patented mining claim. This Mining Lease has been partially assigned to Grant Hartford Corporation both by the terms of the Grant Hartford Option Agreement between Commonwealth Resources, L.L.C. and the Company and through a Partial Assignment of Amended Mining Lease, which assigned to Grant Hartford the leasehold interest in the Amended Mining lease and the right to acquire, upon exercise of the purchase option defined in the Lease and Amended Lease, the mineral rights in and to the mining claim. The terms and nature of this Mining Lease, amended on or about February 20, 2009, are as follows: River Terrace Estates, Inc. leases Free Coin Quartz Lode, Mineral Survey No. 4652, Patent No. 28062 containing 13.86 acres, more or less, to Commonwealth Resources, L.L.C. for a period of seven years from March 29, 2007, subject to Commonwealth Resources, L.L.C.'s option to purchase. Commonwealth Resources, L.L.C. shall have the exclusive right to enter upon and have possession of the mining claims for the purpose of testing, exploring, developing, and operating the mining claims as unpatented mining claims and extracting from and selling, with the exception of the portion attributable to River Terrace Estates, Inc., any minerals found thereon and therein, specifically including, but not limited to, gold, silver, copper, gemstones and other minerals or gems. The places where any testing, exploring, developing and operating of the claim shall be done, and the extent thereof, shall be left entirely to the discretion of Commonwealth Resources, L.L.C., provided however, that Commonwealth Resources, L.L.C. shall perform all work on said premises in a good and miner-like manner so as to preserve the premises as a workable lode mining claim. The following are the material terms of the option to purchase the subject mining claim: Commonwealth Resources, L.L.C.

shall pay an annual rent payment of $500; Commonwealth Resources, L.L.C. shall pay a 3% net smelter return on all minerals extracted from the claim during the seven years immediately succeeding the date of the Amended Mining Lease; Commonwealth Resources, L.L.C. shall pay any real property, or any other taxes assessed or levied against mining claims, Commonwealth Resources, L.L.C.'s property, or structures on the mining claim; Commonwealth Resources, L.L.C. shall pay all costs for the operation of said premises; Commonwealth Resources, L.L.C. will not allow a lien of any kind to be imposed or enforced against the premises; and Commonwealth Resources, L.L.C. will maintain appropriate insurance policies, including general liability and auto-related liability. A default on the option to purchase the subject mining claims consists of a violation of any provision of the Mining Lease, culminating in River Terrace Estates, Inc. delivering a written notice of violation and 120 day notice of termination of Mining Lease to Commonwealth Resources, L.L.C. Commonwealth Resources, L.L.C. has 120 days from receipt of said notice to cure the default; otherwise River Terrace Estates, Inc. may take possession of the premises. The following are the material terms of the purchase agreement of the subject mining claim: Commonwealth Resources, L.L.C. shall give its notice of intention to purchase the mineral claim within seven (7) years from March 29, 2007. The purchase price for the subject mining claim shall be $60,000, plus 12% bonus per annum, computed from the date of the Mining Lease to the date of the final closing payment, not to be more than ninety (90) days after the notice to exercise the option is given to River Terrace Estates, Inc.

Share Purchase Agreement

On or about May 24, 2010, Grant Hartford Corporation and Commonwealth Resources, L.L.C. executed a Share Purchase Agreement, by which Grant Hartford Corporation agreed to issue 5,000,000 of its common shares to Commonwealth in return for the sale to Grant Hartford by Commonwealth of eight prospecting leases on BLM-owned mining claims and ninety-three (93) unpatented mining claims. In addition to the issuance of the shares described herein, Xxxxx Xxxxxxxx will be obligated to pay Commonwealth a 5% net smelter return on any ore processed by it from, with one exception, any of the mining claims and prospector leases described in Exhibit "A" attached hereto, which net smelter return shall be payable in legal tender of the United States of America or in kind, at the election of Commonwealth, and Grant Hartford shall provide with each payment detailed production and precious metal recovery reports by Xxxxx Xxxxxxxx, and if refined, by the refiner. Such royalties shall not be required, however, to be paid from ore processed from the Shamrock unpatented mining claim. The obligation to pay royalties shall be a continuing obligation for as long as ore is processed from any of the applicable claims or leases.

Until such time as Grant Hartford exercises or terminates, or allows to terminate its purchase option contained in the June 15, 2007 Option Agreement between the parties, as amended, or until Grant Hartford elects to release any of the unpatented mining claims or prospector leases which are the subject of this Agreement, Grant Hartford shall:

(a) make timely payment of all fees, including, but not limited to, all annual assessment fees required by the Bureau of Land Management, and, if applicable, timely take any other actions necessary to keep all unpatented claims in good standing;

(b) take all actions necessary to maintain the prospector leases in good standing;

( c) within 60 days deliver to Commonwealth all existing drill core, samples and pulps from the Property and copies of all formal reports (if prepared), maps, plans, photographs, assays, drill logs and any other information or data of Grant Hartford relating to the Property, provided that Grant Hartford does not make any representation or warranty concerning the accuracy or completeness thereof, and Commonwealth shall hold Grant Hartford harmless from any damages Commonwealth may otherwise claim to have arisen from its review or use of such information (specifically excluded from information required to be provided to Commonwealth are any internal correspondence or memoranda of Xxxxx Xxxxxxxx relating to the Property which do not constitute official Grant Hartford reports related thereto);

(d) within 180 days remove from the Property any machinery, buildings, structures, facilities, equipment and all other property of every nature and description erected, placed or situated thereon by Xxxxx Xxxxxxxx, its servants, agents or independent contractors; any property not so removed at the end of the 180 day period shall at the option of Commonwealth become the property of Commonwealth; and

(e) within the said 180 days reclaim any excavations, drill sites and other work performed by Xxxxx Xxxxxxxx, in accordance with law and complete all replacement of structures.

In the event Grant Hartford at any time elects to release any of the unpatented claims or prospector leases, Grant Hartford shall convey those claims or leases to Commonwealth at no cost to Commonwealth, except that Commonwealth shall bear the expense of recording and/or registering the transfers with the appropriate authorities. In the event Grant Hartford becomes insolvent or a petition in bankruptcy is filed for it, whether voluntarily or involuntarily, or in the event that Grant Hartford declines or fails timely to exercise its purchase option under the terms of the Option Agreement between the parties dated June 15, 2007, Xxxxx Xxxxxxxx shall convey those mining claims and prospector leases to Commonwealth at no cost to Commonwealth, except that Commonwealth shall bear the expense of recording and/or registering the transfers with the appropriate authorities. In addition, Xxxxx Xxxxxxxx shall convey to Commonwealth at Grant Hartford's cost basis therefor those additional patented claims in the Garnet and Coloma Mining Districts that were acquired by it and that were previously owned or under contract to Commonwealth's predecessors-in-interest, including the following Charlton Family related entities: Garnet Holding Corporation, Garnet Mining Corporation, Cordoba Corporation,

Cordoba Development Corporation, Copper Cliff Corporation and Xxxxx Xxxxx Corporation, as described in Article 3 of the Share Purchase Agreement.

Failure of either party to perform any of said party's obligations under the Share Purchase Agreement shall constitute a default. Should any default by either party continue for ten (10) days, the other party may, at such party's option, give the defaulting party written notice of the default or defaults claimed. If all such defaults are not cured within twenty (20) days after the service of said notice, then, without further notice of any kind, the party so giving notice may invoke any and all remedies which such party may have at law, equity or otherwise by statute.

The parties to the agreement are in the process of completing registration of the subject unpatented mining claims with the Bureau of Land Management, but legal counsel has confirmed that the purchase of the claims is fully in effect and legally enforceable even prior to completion of registration with the BLM. One of the unpatented mining claims so transferred, the Shamrock, MMC 17214, is shown on the records of the Bureau Of Land Management as being owned by the Estate of Xxxxx X. Xxxxx. To the certain knowledge of Xxxxx X. Xxxxxxxx, Xx. Xxxxx conveyed the Shamrock to Pegasus Gold Corporation, who subsequently conveyed it to companies controlled by Xxxxx X. Xxxxxxxx, who in turn conveyed it to Commonwealth Resources, LLC. Since the deed from Xx. Xxxxx to Pegasus apparently was not recorded, a quiet title action will need to be completed to perfect title. Legal Counsel foresees no obstacles to successful completion of the quiet title action. Commonwealth has agreed to undertake the expense of prosecuting the quiet title action and providing proper title to Grant Hartford.

The Company has confirmed to its satisfaction that all of the unpatented claims and the eight prospector leases are in good standing with the Bureau Of Land Management and has confirmed that conclusion by reference to the records of the Bureau of Land Management.

EXHIBIT "A" TO APPENDIX "A"
WITH RESPECT TO SHARE PURCHASE AGREEMENT CLAIMS

Prospecting Leases on BLM-Owned Patented Mining Claims:

Claim Name	Mineral Survey No.
Tostman	MS7514
Xxxxx Xxxxx	MS 9876
Xxxxxx Xxxxx	MS 3616
San Xxxx	MS 3615
Iowaan	MS 3614
Xxxxxx & Anderson	MS 9876
High Road	MS 9413
Cave Hill	MS 5455

Unpatented Mining Claims (91 total)

Shamrock MMC No. 17214

The remaining unpatented mining claims, 90 in number, are more particularly described as follows:

Serial Number	Claim Name	Location Year
XXX000000	CR 1	6/29/2009
MMC222089	CR 2	6/25/2009
MMC222090	CR 3	6/29/2009
MMC222091	CR 4	6/26/2009
MMC222092	CR 5	7/6/2009
MMC222093	CR 6	7/6/2009
MMC222094	CR 7	7/6/2009
MMC222095	CR 8	7/6/2009
XXX000000	CR 9	7/10/2009
MMC222097	CR 10	7/6/2009
MMC222098	CR 11	7/6/2009
MMC222099	CR 12	7/6/2009
MMC222100	CR 13	6/22/2009
MMC222101	CR 14	6/22/2009
MMC222102	CR 15	6/24/2009
MMC222103	CR 16	6/23/2009
XXX000000	CR 16 GRANITE	6/24/2009
MMC222105	CR 17	6/23/2009
MMC222106	CR 18	6/18/2009
MMC22107	CR 19	6/18/2009
MMC222108	CR 20	6/18/2009
MMC222109	CR 20 GRANITE	6/24/2009
MMC222110	CR 21	6/19/2009
MMC222111	CR 22	6/22/2009
XXX000000	CR 23	6/22/2009
MMC222113	CR24	6/19/2009
MMC222114	CR25	6/19/2009
MMC222115	CR26	6/18/2009
MMC222116	CR27	6/18/2009
MMC222117	CR28	6/23/2009
MMC222118	CR29	6/23/2009
MMC222119	CR30	6/23/2009
XXX000000	CR31	7/8/2009
MMC222121	CR32	7/8/2009
MMC222122	CR33	7/8/2009
MMC222123	CR34	6/30/2009
MMC222124	CR35	6/30/2009
MMC222125	CR36	6/30/2009
MMC222126	CR37	6/30/2009
MMC222127	CR38	6/30/2009
MMC222128	CR39	6/30/2009
MMC222129	CR40	6/25/2009

MMC222240	CR47	8/27/2009
MMC222241	CR48	8/27/2009
MMC222242	CR49	8/27/2009
MMC222243	CR50	8/27/2009
MMC222244	CR51	8/27/2009
XXX000000	CR52	8/27/2009
MMC222246	CR53	8/21/2009
MMC222247	CR54	8/21/2009
MMC222248	CR55	8/21/2009
MMC222249	CR56	8/21/2009
MMC222250	CR57	8/18/2009
MMC222251	CR58	8/18/2009
XXX000000	CR59	8/18/2009
MMC222253	CR60	8/17/2009
MMC222254	CR61	8/17/2009
MMC222255	CR62	8/17/2009
MMC222256	CR63	8/17/2009
MMC222257	CR64	8/13/2009
MMC222258	CR65	8/13/2009
MMC222259	CR66	8/13/2009
XXX000000	CR67	8/13/2009
MMC222261	CR68	8/13/2009
MMC222262	CR69	8/13/2009
MMC222263	CR70 GRANITE	8/13/2009
MMC22263	CR70 MSLA	8/13/2009
MMC222264	CR71	8/13/2009
MMC222265	CR72	8/13/2009
MMC222266	CR73	8/13/2009
MMC222267	CR74	8/13/2009
MMC222268	CR75	8/17/2009
MMC222269	CR76	8/17/2009
MMC222270	CR77	8/31/2009
MMC222271	CR78	9/4/2009
MMC222272	CR79	9/4/2009
MMC222273	CR80	9/14/2009
MMC222274	CR81	9/14/2009
MMC222275	CR82	8/31/2009
MMC222276	CR83	9/4/2009
MMC222277	CR84	9/14/2009
XXX000000	CR85	9/14/2009
MMC222279	CR86	9/4/2009
MMC222280	CR87	9/2/2009
MMC222281	CR88	9/2/2009
MMC222282	CR89	8/20/2009
MMC222283	CR90	8/19/2009
XXX000000	CR93	8/20/2009
MMC222287	CR94	8/20/2009
MMC222288	CR95	8/20/2009

Agreement with Garnet Range Resources, LLC and Grant Hartford Corporation

Grant Hartford Corporation is a mineral exploration, development and production company and during its normal course of business Grant Hartford Corporation sub- contracts all drilling and earth moving tasks required to complete our drill programs on the Garnet Mineral Property. In June, 2009, Grant Hartford Corporation recognized unforeseen circumstances in the Company's current arrangements to rent and operate the heavy equipment necessary to perform its exploration activities. In order to fulfill this need, the Company entered into a non-exclusive Agreement with Garnet Range Resources, LLC ("Garnet"), on July 6, 2009. The non-exclusive agreement was for an open-ended term, wherein Garnet is to provide support services to Grant Hartford in the form of the operation of heavy equipment, provision of labor and coordination of project management with respect to exploring the mining claims located on the Garnet Mineral Property, which is Optioned by Grant Hartford Corporation. Garnet Range Resources, LLC is owned by two individuals, Xxxx Xxxxx and Xxxxx Xxxxxxxx; each owns fifty percent (50%) of Xxxxxx's membership interests. Xxxx Xxxxx is the President, CEO & Director of Grant Hartford Corporation and a related party to Xxxxx Xxxxxxxx Corporaiton, and Xxxxx Xxxxxxxx is the spouse of Xxxxx Xxxxxxxx, Senior Consultant and a related party to Grant Hartford Corporation. The material terms of the Agreement are as follows: Xxxxx Xxxxxxxx agrees to rent a Caterpillar D8H Dozer #46A18817 and a PC400LC Komatsu Excavator #A85031 from Garnet. The rental agreement shall include an operator, all maintenance, repair and support of the equipment, payment of taxes, insurance and all operating expenses, including fuel, which shall be the responsibility of Garnet. Garnet Range Resources is committed to having equipment available on-site 24 hours a day and has developed a current rate structure for equipment rental and services which Garnet represents to be at a rate approximately 20% below comparable rates for local equipment contractors.

Changes to the Agreement shall be made by Appendix to the Agreement. Garnet shall deliver monthly invoices, itemizing the services rendered during that period. Grant Hartford shall pay within ten (10) calendar days of receipt of Xxxxxx's invoice. Any disputed amount that is not resolved within twenty (20) days of invoice must be paid to a mutually-agreed third party until resolution. Garnet shall be solely responsible for employing personnel and paying any costs associated with the personnel. Xxxxxx holds Grant Hartford harmless from liability. Garnet and Grant Hartford are each to have $1,000,000 insurance policies to cover their own liability. Failure of either party to perform any of said party's obligations under the Agreement shall constitute a default. In the event the default continues for five (5) days, written notice shall be given to the defaulting party. The default may be cured within twenty (20) days of service of written notice. In the event the default is not cured within the twenty (20) day period, the contract shall terminate. Governing law shall be the State of Montana.

Vehicle Lease Agreement with Garnet Range Resources, LLC.

On July 1, 2009, Grant Hartford Corporation entered into a vehicle lease agreement with Garnet Range Resources, LLC ("Garnet"), a Montana limited liability company that is owned by two individuals, Xxxx Xxxxx and Xxxxx Xxxxxxxx, each owns fifty

percent (50%) of Garnet's membership interests. Xxxx Xxxxx is the President, CEO and Director of Grant Hartford Corporation, a related party to the Company, and Xxxxx Xxxxxxxx is the spouse of Xxxxx Xxxxxxxx, Senior Consultant and a related party to Grant Hartford Corporation. The material terms of the Agreement are as follows: Garnet shall provide GHC the use of an automobile for a period of 2 years beginning April 22, 2009 to April 21, 2011. GHC shall pay Garnet, in advance, the sum of $4,500 for the use of the vehicle for the 2 year period. GHC shall have comprehensive insurance coverage on the vehicle. GHC shall be responsible for all repairs, licensing, fuel and any other costs associated with the vehicle during the lease period.

Appendix B

CAMP DRESSER & XXXXX, INC.

Final Report on Metallurgical Test Work Conducted
on Five (5) Samples for Garnet Mining.

August 11, 2009

OUR PROJECT NO. P-4080

		TABLE OF CONTENTS
				Page No.
X.	Xxxxxx Description and Head Assays. . . . . . . . . . . . . . . . . . . . . . . .		. . .	2
II.	Test Results. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. .	3
	A.	Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. .	4
	B.	Gravity Recoverable Gold (GRG) Results on Sample No. 5.	. . .	5
	C.	Grind Series Knelson Gravity/Flotation Tests on Sample No. 5.		. 6
	X.	Xxxxxxx Gravity/Flotation Tests on Samples 1-5. . . . . . . . . .	. . .	8
	X.	Xxxx Work Index (BWI) Results on Sample No. 5. . . . . . . .	. . .	10
	F.	Acid-Base Accounting (ABA) Results. . . . . . . . . . . . . . . . . .	. . .	10
	G.	Test Work to Generate Water Samples for Detailed Analysis. . .		11
	H.	Summary of Solid/Xxxxxx and Thickening Work by DOE. . .	. . .	11
III.	Test Procedures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. . .	13
	A.	Batch Knelson Gravity Concentration/Bulk Sulfide
		Flotation Tests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	13
	X.	Xxxx Work Index (BWI) Test. . . . . . . . . . . . . . . . . . . . . . . . .	. . .	13
	C.	Acid-Base Accounting. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. .	14
IV.	Discussion, Proposed Future Work and Recommendations . . . . . . . .		. .	14

APPENDICES:
Appendix A -	Head Assay ICP Scans (by Clemex)
Appendix B -	Tables and Graphs
Appendix C -	Data Test Sheets

August 11, 2009

Camp Dresser & XxXxx Inc.
Chase Tower
00 Xxxx Xxxxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000-0000

Attention: Xx. Xxxxxxx Xxxxxxxxxx

Subject: Final Report on Metallurgical Test Work Conducted on Five (5) Samples for Garnet Mining. Our Project No. P-4080.

Dear Xx. Xxxxxxxxxx,

DML was contracted by Camp Dresser & XxXxx (CDM) to perform metallurgical work on five individual samples for Garnet Mining on a property located in Montana. The test work was conducted to evaluate the feasibility of recovering precious metals and selected base metals (mainly copper) from the four individual samples and one composite.

The majority of the initial scoping test work was conducted on Sample No. 5. This sample was sent to DML and was comprised of 20% from Sample No. 1, 20% from Sample No. 2 and 60% from Sample No. 3, and represents low and high grade gold ore types used for milling.

The following test work was conducted:

	·	Conduct a gravity recoverable gold (GRG) test on Sample No. 5 using a Knelson centrifugal concentrator. The sequential test was performed at a nominal 95% passing 1700, 212 and 100 microns (tailings were reground and rerun through the Knelson). The test determined the free milling gold content of the sample at three different grind sizes.
	·	Conduct a series of kinetic bulk sulfide flotation tests on Sample No. 5 Knelson gravity tailings at seven different grind sizes ranging from P₈₀= 82 to 354 microns.
	·	Conduct Knelson gravity - bulk sulfide flotation on the remaining four samples using the "optimum" grind determined on Sample No. 5.
	·	Conduct acid-base accounting on head and flotation tailings samples on each of the five samples.
	·	Conduct a Bond work index (BWI) test on Sample No. 5 at a closing size P₈₀=150 microns (100 mesh).

-2-

	·	Conduct an ICP scan on head samples from each of the five individual samples.
	·	Conduct thickening and filtration tests on a flotation tailings sample generated from Samples No. 1, 2, 3 and 5. Work was performed by Xxxx Xxxxxx XXXXX (XXX)
	·	Water samples from flotation test work were sent to Xx. Xxxx Xxxxxxx from CDM for detailed analysis.

Sample Description and Head Assays

Four individual samples and one composite (Sample No. 5) were received at our laboratory on May 21, 2009 and assigned our project No. P-4080. The samples weighed from 16.5 to 19 kg with a top size of approximately 3/8 inch (9.5 mm) and appeared to be reverse circulation (RC) cuttings. In addition, an approximate 15 kg sample of Sample No. 5 was received on May 27, 2009 for subsequent Bond Work index work.

Each sample was stage crushed separately to -10 mesh using a parallel rolls crusher, blended in a "V" cone blender and split into 1.0 kg test charges using a rotary spinning table. All samples were stored in a freezer prior to test work.

A summary description (provided by CDM) of the individual samples is presented.

Sample 1: A composite from a primary high grade vein system. 40 pounds composited from 10 samples of oxidized and un-oxidized quartz vein material and granodiorite with a head grade of 0.159 opt Au and 0.39 opt Ag.

Sample 2: A composite from an alternate high grade view systems. 39 pounds composited from 9 samples of primarily oxidized quartz vein and altered granodiorite. The assayed head grade is 0.175 opt Au and 0.66 opt Ag. This sample also contains higher levels of Cu.

Sample 3: A composite from the primary pit area. 40 pounds composited from 13 pit grade samples. This sample contains primarily altered, oxidized granodiorite with an assay head grade of 0.049 opt Au and 0.2 opt Ag.

Sample 4: An oxidized vein material contained in marble. 36 pounds from 6 samples with an assay head grade of 0.443 opt Au and 0.35 opt Ag. This sample may not be used in the initial test work because it is a minor example of over-all ore types.

Sample 5: A composite of samples 1, 2, and 3. 40 pounds composited as follows: 20% from sample 1, 20% from sample 2, and 60% from sample 3. Composite assay head grade of 0.088 opt Au and 0.61 opt Ag. This sample will be used to simulate blending of high and low grade ore types for milling.

-3-

A 1.0 kg test charge from each sample was sub split for head assay. Each head sample was assayed for Au (in duplicate), Ag, Cu, S_total, S_SO4and S=. Gold was assayed by fire assay with an Atomic Adsorption (AA) finish; Ag was assayed by AA. Total sulfur was assayed using a Leco sulfur analyzer; S= was determined by a NaCO₃xxxxx to dissolve SO₄species followed by sulfur determination using the Leco. The difference between S_totaland S= in the residue is the SO₄assay. Head assays are reported in the following table.

P-4080: CDM Garnet Mining
Head Assay Results

An ICP scan was conducted on each sample and results are presented in the appendix section at the end of this report.

Test Results

All reagent dosages are reported in lb/ton of ore, unless otherwise stated. All Knelson concentrates were hand panned using a vanning plaque resulting in a low weight, gold bearing hand pan concentrate and lower gold grade hand panned tailings products. The hand panned concentrates are referred to in this report as the Knelson concentrates. All hand panned tailings were combined with the Knelson gravity tailings. Test products were assayed for gold, silver and copper. Due to the low grades of silver and copper only gold results will be presented in the body of this report. Complete results are presented in detailed data tables and test sheets in the appendix at the end of this report.

-4-

All Knelson concentrates and the first rougher concentrate for all tests were examined under an optical microscope to identify free gold shape and size. The observations and sizing are recorded at the bottom of each test sheet.

II.A.

Summary

	·	All Knelson gravity concentrates contained visible free gold in varying amounts and sizes, along with pyrite and magnetite. Typically the free gold averaged 50 microns in size with a top size of 300 microns in size. Sample No. 4 contained the most free gold of the samples tested. Sample No. 3 contained the least free gold. In general, the gold was nugget shaped and appeared to be of high purity.
	·	Gravity recoverable gold (GRG) results on Sample No. 5 show that the gold recovered into individual hand panned Knelson concentrates at test P₉₅=1700, 212 and 100 microns was 23.8, 7.4 and 13.4% respectively. A total of 45% of the total gold was recovered into the combined three gravity concentrates, which assayed 10.6 opt Au.
	·	Results from the kinetic bulk sulfide flotation tests at various grind sizes on Sample No. 5 show that the highest gold recovery was achieved at a primary grind P₈₀=187 microns. All work included a Knelson gravity concentration step prior to the flotation work. A gold recovery of 79% was obtained in the combined Knelson gravity/flotation concentrates which assayed 3.25 opt Au.
	·	Results from the Knelson gravity/bulk sulfide flotation test work on Samples 1-5 show gold recovery into combined gravity/flotation concentrates ranged from 57 (Sample 3) to 98%(Sample No. 1). Results are based on 8 minutes of flotation time of the Knelson tails, and are presented in the following table.

P-4080: CDM Garnet Mining
Samples 1-5: Results of Total Gold Recovery (Gravity + Flotation) at a Targeted P80=190

			Knelson Con + 8 min Flotation Con
					Au Dist, %
Sample No.	Grand P_80, Microns	Wgt %	Au Assay, opt product	Au Distribution, opt of ore	Au Dist, %
1	176	4.0	3.71	0.15	98.4
2	182	4.0	2.90	0.12	72.6
3	185	3.8	0.68	0.03	57.4
4*	205	0.9	21.92	0.12	82.3
5	184	3.8	2.28	0.09	82.3
5**	187	2.2	3.25	0.07	79.0**

*Sample 4 contained significant free Au.
**Results based on 4 minutes of flotation time.

	·	Results from the Sample No. 5 Bond Work index (BWI) test at a closing size of 100 mesh (150 microns) show a power requirement of 12.78 kWh/short tonne (14.09 kWh/metric tonne).
	·	Flotation water samples were generated from two separate tests and sent to Xx. Xxxx Xxxxxxx of CDM for detailed analysis.
	·	ABA results show that all of the flotation tails had a net neutralizing capacity that ranged from 16.5 to 200 tons CO₃/1000 tons flotation tails.

-5-

II.B.

Gravity Recoverable Gold (GRG) Results on Sample No. 5

A GRG test was conducted on Sample No. 5. The test incorporated processing a 1.0 kg charge of -10 mesh (1.7 mm) material in the Knelson gravity concentrator. The Knelson concentrate was collected and the Knelson tailings filtered, and ball mill ground to a targeted P₉₅=212 microns. The ground material was processed through the Knelson gravity concentrator and a Knelson concentrate collected. The tailings were ball ground a second time to a targeted P₉₅=100 microns and the Knelson gravity process repeated.

The three Knelson concentrates were assayed separately to determine total milligrams of gold. The final Knelson tailings were filtered, dried and two separate sample splits taken for gold assay.

Results from this test show that the 24, 7 and 13% of the total gold reported to the 1.7 mm, P₉₅=212 micron and 100 micron Knelson concentrates, respectively. A total of 45% of the gold reported to the combined Knelson concentrates which contained 0.4% of the total weight of the test sample, and assayed 10.6 opt gold. Results are presented below with a graph on the next page.

P-4080: CDM Garnet Mining
Test No. 1: GRG Test Results

P95, microns	Product	Wgt %	Au, Assay, opt product	Au distribution, opt of ore	Au, Distribution, %
1700	Knelson con 1	0.21	9.60	0.020	23.8
212	Knelson con 2	0.06	11.13	0.006	7.4
100	Knelson con 3	0.09	12.64	0.014	13.4
	Knelson tails	99.64	0.0473	0.047	55.4
	Calc Head	100.00	0.085	0.085	100.0
	Assay Head		0.093

	Knelson cons 1-3	0.36	10.61	0.038	44.6

Knelson concentrates contained free gold ranging from 50 microns (+20 pieces) to 300 microns (1 piece).

-6-

II.C.

Grind Series Knelson Gravity/Flotation Tests on Sample No. 5

A series of Knelson gravity/kinetic bulk sulfide flotation tests were conducted at various grind sizes ranging from P80=82 to 354 microns on sample No. 5. Each test incorporated Knelson gravity concentration of the ground ore followed by bulk sulfide flotation of the Knelson gravity tails at natural pH. The reagents used for bulk sulfide flotation were 0.02 lb/ton Cytec A-208 and 0.02 lb/ton potassium amyl xanthate (PAX). Flotation concentrate samples were taken at 30 sec, 1, 2 and 4 minutes. After 4 minutes the froth was barren in all tests.

Free gold was observed using an optical microscope in the 0-30 second flotation concentrate for all tests. The free gold was typically 50 microns in size, with pieces up to 300 microns in size.

Results show gold recovery of the combined Knelson concentrate/flotation concentrates ranged from 71 to 79%, with grades of 1.2 to 3.3 opt gold. The highest recovery was achieved at a grind P80=187 microns. Surprisingly, the gold recovery decreased as the grind size decreased. At this point there is no explanation for this result. A summary of the results is presented in the following table along with kinetic graphs.

-7-

P-4080: CDM Garnet Mining
Sample No. 5: Grind Series on Gold Recovery

			Knelson Con + 8 min Flotation Con
Test No	Grind P_80, Microns	Wgt %		Au Assay, opt product	Au Distribution, opt of ore	Au Dist, %	Ro Tails, Au, opt	Calc. Head Au, opt
5	82	4.7		1.20	0.057	71.3	0.024	0.079
4	103	3.5		1.82	0.064	71.9	0.026	0.089
3	144	2.7		2.28	0.061	73.2	0.023	0.084
2	187	2.2		3.25	0.071	79.0	0.019	0.090
6	226	2.5		2.56	0.063	73.3	0.024	0.086
7	270	2.6		2.46	0.063	71.6	0.024	0.088
8	354	2.6		2.57	0.068	72.2	0.024	0.094
							Head Assay	0.093

A second test of sample No. 5 (T-14) was conducted at a P80=184 microns to confirm result from T-2. Results from this test show an overall gold recovery (Knelson gravity + flotation concentrate) of 79% and a gold grade of 3.03 opt gold.

The kinetic graphs show that gold recovery may not be complete after 4 minutes of flotation, though the flotation froth was watery and appeared to be barren. Subsequent work on the remaining 4 samples incorporated 8 minutes of flotation time.

-8-

II.X.

Xxxxxxx Gravity/Flotation Tests on Samples 1-5

Knelson gravity/kinetic bulk sulfide flotation tests were conducted on the five individual samples and a targeted grind P₈₀=190 microns. Each test incorporated Knelson gravity concentration of the ground ore followed by bulk sulfide flotation of the Knelson gravity tails. The reagents used for bulk sulfide flotation were 0.02 lb/ton Cytec A-208 and 0.02 lb/ton potassium amyl xanthate (PAX). Flotation concentrate samples were taken at 30 sec, 1, 2, 4 and 8 minutes.

Results show gold recovery of the combined Knelson concentrate + flotation concentrates ranged from 57 to 98%. The combined concentrates yielded gold grades ranging from 0.7 to 22 opt gold. A summary table of the results is presented in the following table.

P-4080: CDM Garnet Mining
Samples 1-5: Results of Total Gold Recovery (Knelson Concentrate + Flotation Concentrates) at a
Targeted P₈₀=190

				Knelson Con + 8 min Flotation Con

SampleNo.	Test No	Grind P_80, Microns	Wgt %		Au Assay, opt product	Au Distribution, opt of ore	Au Dist %	Rio Tails, Au, opt	Calc. Head Au, opt
1	10	176	4.0		3.71	0.148	98.4	0.003	0.150
2	11	182	4.0		2.90	0.116	72.6	0.046	0.160
3	12	185	3.8		0.68	0.026	57.4	0.020	0.045
4	13	205	0.9		21.92	0.120	82.3	0.024	0.241*
5	14	184	3.8		2.28	0.087	82.3	0.020	0.106
5	2	187	2.2		3.25	0.071	79.0**	0.019	0.090

*Sample 4 contained significant free Au.
** Test 2 results based on 4 minutes of flotation time.

-9-

The kinetic results presented indicate that gold recovery for most samples was complete after 8 minutes. Additional flotation time will be required for Samples 2 and 3.

The individual Knelson concentrate grades ranged from 1.4 (Sample No. 3) to 140 opt gold (Sample No. 4), in concentrates weighing from 0.1 to 0.5% of the total sample, respectively. A summary of the Knelson concentrate results is presented below.

P-4080: CDM Garnet Mining
Samples 1-5: Knelson Concentrate Gold Results at a Targeted P₈₀=190 microns

			Knelson concentrate
						Au Dist, %
Sample No.	Test No	Grind P₈₀, Microns	Wgt %	Au Assay opt product	Au Distribution opt of ore
Sample No.	Test No	Grind P₈₀, Microns	Wgt %
1	10	176	0.16	33.54	0.055	36.4
2	11	182	0.34	11.68	0.039	24.4
3	12	185	0.49	1.38	0.007	14.9
4	13	205	0.09	140.4	0.121	50.3
5	14	184	0.48	4.84	0.023	21.7
5	2	187	0.16	9.83	0.016	17.4

-10-

II.X.

Xxxx Work Index (BWI) Results on Sample No. 5

A BWI test was conducted on Sample No. 5 at a closing size of 100 mesh (150 microns). Results are presented in the following table.

P-4080: CDM Garnet Mining
Sample No. 5: BWI Results; Closing Size 100 mesh (150 microns)

		gm/mill rev	BWI
F80, microns	P80, microns	(last 3 cycles)	kWh/short ton	kWh/metric ton
2236	126	1.804	12.78	14.09

Based on the BWI values, Sample No. 5 would be considered as moderately hard.

II.F.

Acid-Base Accounting (ABA) Results

ABA work was performed on samples of feed and flotation tails from each of the five individual samples to determine if they would be net acid producing or have an excess neutralizing capacity. A Kennecott Utah Copper (XXX) ABA test procedure was used.

A pulverized split from each sample was assayed for S= to subsequently determine the acid potential (AP). A separate sample from each feed and tailings was contacted with 0.1 N HCl then back titrated with NaOH to an inflection point to determine the neutralizing potential (NP). The difference (NP - AP) yields the ABA value. A negative ABA value indicates potential acid production. Positive ABA values indicate excess neutralizing capacity. ABA results are presented in the following table.

P-4080: CDM Garnet Mining
ABA Results (Using XXX Procedure) on Head and Flotation Tailings Samples

		Assay, %			ABA Potential
Comp	Sample	S=	AP*	NP*	(NP-AP)*
1	Head	0.959	29.97	20.67	-9.30
	Tailings	0.053	1.66	18.13	16.47
2	Head	0.194	6.06	58.09	52.03
	Tailings	0.038	1.19	39.64	38.45
3	Head	0.052	1.63	42.12	40.50
	Tailings	0.035	1.09	42.77	41.67
4	Head	0.032	1.00	222.69	221.69
	Tailings	0.014	0.44	200.14	199.71
5	Head	0.220	6.88	35.41	28.53
	Tailings	0.027	0.84	40.18	39.33

* tons CaCO₃/ 1000 tons scav tailings

NOTE: A negative ABA value suggests a potential acid producer.

Results show that the tails samples have net neutralizing capacity.

-11-

II.G.

Test Work to Generate Water Samples for Detailed Analysis

Two separate bulk sulfide flotation tests were conducted using the standard flotation test procedure to obtain water for analysis. No Knelson gravity work was performed prior to the flotation tests. The first test used a 1.0 kg test charge of Sample No. 5 ground to a P80=144 microns; the second tests used combinations of Samples 1, 2, 3 and 5 ground to a P80=188 microns to generate a 12 kg flotation feed. Flotation tails water collected from the first test was sent to Energy Labs in Helena, Montana. Flotation water collected from the second test flotation tails was sent to Xx. Xxxx Xxxxxxx of CDM in Helena, Montana.

In addition, the flotation tailings from the 12 kg test were delivered to Xxxx Xxxxxx XXXXX (XXX) for solid/liquid and thickening test work.

Flotation products were collected from each test and assayed to generate an overall balance for each test. A summary of the results is presented in the following table.

P-4080: CDM Garnet Mining
Summary of Flotation Tests Used to Generate Water Samples for Detailed Analysis

			Flotation concentrate
Sample No.	Test No	Grind P_80, Microns,	Wgt %	Au Assay, opt product	Au Dist, opt of ore	Au Dist, %	Ro Tails, Au, opt	Calc. Head Au, opt



5	9	144	3.51	2.74	0.096	78.5*	0.027	0.122
1, 2, 3 & 5	15	188	1.64	4.16	0.068	79.6**	0.018	0.086

*1.0 kg test, after 4 minutes of flotation time.
**12 kg test, after 20 minutes of flotation time.

II.H.

Summary of Solid/Xxxxxx and Thickening Work by DOE

A summary of the DOE work is presented in the following section. The complete report will be presented by XXX

A summary of sedimentation testing is in Table 1. Note all units are meteric

align=center class=td441>2.5

Test Conditions
Design Feed Rate (mtpd)	240
Feed Suspended Solids (wt %)	25
Recommended floc dose MF 1011 (gpt)	30
Rheology Characteristics
Est. Bed Solids at 1 hr Retention Time (wt%)/ Est. Yield Stress	68 (50 Pa)
Est. Bed Solids at 2 hr Retention Time (wt%)/ Est. Yield Stress	69 (75 Pa)
Est. Bed Solids at 4 hr Retention Time (wt%) / Est. Yield Stress	70 (130 Pa)
Est. Bed Solids at 6 hr Retention Time (wt%) / Est. Yield Stress	71 (170 Pa)
E-CAT®
Design Underflow Density (wt %)	56
Recommended Minimum Diameter (m)
High Rate Thickener
Design Underflow Density (wt %)	63
Recommended Minimum Diameter (m)	5

Table No. 1

-12-

Flocculant screening showed Xxxx's MF 1011 had the best settling. Ciba MF 1011 is an anionic high molecular weight medium charge floc. Flux testing showed that 10 wt % is best for flocculation. Dilution can be achieved using FLSmidth's E-Duc® feedwell system and would not require adding additional water to the system.

The results show that a single E-CAT® or High Rate thickener is adequate for thickening the slurry before sending to a filter. The results also show that the gold tails could be handled by a paste thickener. A paste thickener would produce underflow at 70 wt% solids.

Disc or Drum Filter

Filtration testing was performed to determine filtration equipment. The filter cloth chosen was POPR 955 for the disc or drum filter with a permeability of 5 cfm.

Results of the filtration tests are shown in Table 2.

Filter	Disc	Drum
Cake Moisture (wt %)	20	20
Cake Thickness (mm)	10	6
Feed Rate (dry tpd)	240	240
Filtration Rate (kg/m2/hr)	250	308
Filter Area (m²)	40	33
Equipment	8.5' with 5 discs	8' x 14'

Table 2. Disc or Drum Filter for CDM Gold Tails

From a 63 wt% slurry, one Eimco® 8.5 ft 6 inch disc filter with five discs or one 8 ft diameter x 14 ft length drum filter is sufficient to xxxxxxx 240 tpd gold tails to about 20% moisture. For a 56 wt% slurry a much larger disc or drum filter would be needed.

Pressure Filter

Filtration testing was performed to determine filtration equipment. The filter cloth chosen was Felt 12oz with a permeability of 25 cfm. Results of the filtration tests are shown in Table 3.

Filter	AFP
Cake Moisture (wt %)	13
Cake Thickness (mm)	50
Feed Rate (dry tpd)	240
Filter Volume (m³)	1.84
Equipment	AFP M1200FB

Table 3. Pressure Filter for CDM Gold Tails

One Eimco® Model 1200FB is sufficient to xxxxxxx 240 tpd of gold tails. The AFP would make a cake with 13 wt% moisture.

-13-

III.

Test Procedures

III.A

Batch Knelson Gravity Concentration/Bulk Sulfide Flotation Tests

A 1.0 kg charge of each composite was ball mill ground at 60% solids using DML water and a 7.5 kg ball mill charge. The ground slurry was processed using a Knelson gravity concentrator. The Knelson concentrate was collected and hand panned using a vanning plaque to produce a final Knelson concentrate. The Knelson concentrate was assayed for total milligram of gold. The hand panned tails were combined with the Knelson tail. The Knelson tails were filtered and the solids put into a flotation cell.

All flotation work was conducted using an Agitair 1.0 kg mechanical flotation cell operating at 800 rpm. Flotation reagents Cytec A-208 and potassium amyl xanthate (PAX) were added as 1% solutions. MIBC frother was added at full strength. Flotation concentrates were taken during the Sample No. 5 grind series work at 0.5, 1, 2 and 4 minutes. Follow up flotation work on Samples 1-5 were taken at 0.5, 1, 2, 4 and 8 minutes.

III.B

Bond Work Index (BWI) Test

Sample No. 5 was stage crushed to -6 mesh for a BWI test. A 1.0 kg sample was split out and a screen analysis conducted. A BWI test was performed at a closing size of 100 mesh (150 microns) using standard BWI test procedures.

-14-

III.C

Acid - Base Accounting

The procedure used was supplied by Kennecott Utah Copper (XXX).

Acid Potential (AP)- The S= assay for each sample (x 31.25) determined the acid potential. This assume that the S= present in the sample would eventually form acid.

Neutralization Potential (NP):

1.	Weigh out 1.0 gram of sample to four decimal places. Put into an Erlenmeyer flask
2.	Add 5-10 ml of 0.1 - 0.5 N HCl slowly to the sample
3.	Add 75 ml of DI water to the sample and reflux for 1 minute to drive off CO₂
4.	Set the slurried sample on a stir plate with a stir bar in the sample
5.	Record the pH of slurry. If the pH is less than 2.0, proceed with the titration step. If the pH is greater than 2.0, repeat the above steps with half the amount of sample
6.	Transfer the slurried sample to a 100 ml beaker, and titrate using a 0.1-0.25 N NaOH to the end point
7.	Calculate the Neutralization Potential (NP) using the following equation:

NP = (Volume acid X Normality of acid - Volume of base X Normality of base) X 50
Sample weight

The results are reported as tons CaCO3/1000 tons sample

ABA Potential = Neutralization Potential - Acid Potential

If the ABA is negative, the material tested will likely be an acid producer. If the ABA is positive then the material has excess neutralizing capacity.

VI.

Discussion, Proposed Future Work and Recommendations Discussion

	·	Free gold was observed in Knelson and flotation concentrates for all samples. The free gold ranged in size from 50-300 microns, and averaged about 50 microns. The gold was typically nugget in shape and appeared to be of high purity.
	·	A gold recovery procedure incorporating Knelson gravity concentration followed by bulk sulfide flotation of the Knelson tails resulted in gold recovery ranging from 57 to 98% for the five samples. Results are based on the samples ground to a targeted P₈₀=190 microns. Test results of Sample No. 5, which represent blending of high and low grade ore, show that 82% of the gold reported in the combined Knelson and flotation concentrates (after 8 minutes of flotation of the Knelson tails)
	·	ABA results of the five samples tested show that overall there is a net neutralizing capacity.

-15-

Proposed Future Work

	·	Cleaner Flotation Work - Cleaner flotation tests of the rougher concentrate could be performed to determine the parameters required to achieve a higher grade low weight final gold concentrate. Due to the low weight pull in the rougher concentrate (1.0 to 4%), large-scale test (12-15 kg/test) would be required to generate enough rougher concentrate for the cleaner flotation work. An additional 50 kg/sample would be required for this test work.
	·	Filtration Testing of the Final Flotation Concentrate - Filtration test work, conducted by DOE, could be performed on the final flotation concentrate to determine requirements to achieve a low percent moisture filter cake. Approximately 100 kg of ore feed would be required to generate enough concentrate (1-3 kg of final product) for this study.

Recommendations

	·	A Gemini/gravity shaking table is typically used for upgrading the Knelson concentrates. The shaking table yields a high grade gold concentrate in a small weight that can be directly smelted on or off site. The shaking table tails would report back to the ball mill feed. DML has a Diester ¼ desk shaking table that could be used for Knelson concentrate upgrading work.
	·	Treatment of the final flotation concentrate could be conducted on site using a diesel/natural gas furnace to produce dore metal ready for refining.

If you have any questions about this report, please contact me.

Sincerely,
FLSmidth Xxxxxx Metallurgical Laboratories

/s/Xxxx X. Xxxxxxx

Xxxx Xxxxxxx
Operation Manager
C:\Documents and Settings\pbe-us.FLS\My Documents\CDM\4080 CDM final report.doc

APPENDIX A

Head Assay ICP Scans (by Chemex)

P-4080: CDM
Chemex (Vancouver BC): Detailed Head Assays from Five composite Samples

Element	Units	Comp 1	Comp 2	Comp 3	Comp 4	Comp 5
Ag	opt	0.13	0.32	0.08	0.07	0.12
Al	%	6.6	5.66	6.04	0.74	5.93
As	ppm	13.8	27.8	18.1	11	16.4
Au*	opt	0.089**	0.144	0.032	0.436	0.093
Ba	ppm	980	1380	900	120	980
Be	ppm	1.55	1.51	1.86	0.18	1.37
Bi	ppm	13.95	8.51	1.58	4.82	4.16
Ca	%	2.78	3.88	3.02	17.9	3.06
Cd	ppm	0.12	0.3	0.39	0.13	0.26
Ce	ppm	40.5	34.8	45.4	7.34	35.5
Co	ppm	15.2	13.9	15.6	2.1	12.4
Cr	ppm	59	49	48	6	47
Cs	ppm	4.6	5.17	7.41	0.5	4.78
Cu	%	0.015	0.025	0.022	0.001	0.023
Fe	%	3.98	2.62	2.84	0.51	2.91
Ga	ppm	14.65	12.5	15.90	1.78	11.85
Ge	ppm	0.13	0.13	0.16	0.05	0.1
Hf	ppm	0.6	0.8	0.8	0.1	0.6
Hg	ppm	2.3	8.2	2.2	0.7	4.1
In	ppm	0.037	0.03	0.036	<0.005	0.027
K	%	3	2.81	2.98	0.38	2.87
La	ppm	20.2	17.9	23.2	3.2	18.9
Li	ppm	18.2	19.1	30.3	2.6	21.9
Mg	%	1.12	1.73	1.21	10.1	1.27
Mn	ppm	593	697	624	335	605
Mo	ppm	3.44	3.49	2.21	0.51	1.91
Na	%	1.52	0.7	0.89	0.13	0.97
Nb	ppm	6.9	6.4	7.4	1.3	5.6
Ni	ppm	11.7	12.3	16.3	3.4	10.6
P	ppm	700	620	720	80	630
Pb	ppm	48.3	413	123	37.5	136
Rb	ppm	94.7	96.2	113.5	14.8	88.2
Re	ppm	<0.002	<0.002	<0.002	<0.002	<0.002
S	%	1.22	0.23	0.06	<0.01	0.35
Sb	ppm	29.9	97.9	42.2	1.64	46.1
Sc	ppm	9.4	7.9	11	1.1	7.7
Se	ppm	2	1	2	2	1
Sn	ppm	1.1	1.2	1.2	0.2	0.9
Sr	ppm	323	187.5	214	81.7	229
Ta	ppm	66	0.7	0.71	0.12	0.56
Te	ppm	4.26	6.98	1.71	4.61	2.8
Th	ppm	8.7	8.8	8.6	1	8.9
Ti	%	0.267	0.193	0.234	0.028	0.223
Tl	ppm	0.52	0.5	0.61	0.06	0.46
U	ppm	3.4	3	2.2	0.4	2.3
V	ppm	81	63	73	10	70
W	ppm	25.1	49.4	39.8	6.6	34.2
Y	ppm	13.2	11.5	14.4	2.6	10.6
Zn	ppm	50	58	75	19	62
Zr	ppm	8.4	14.9	15	3.8	10.4

*DML Assay (average of 2 separate assay cuts)
**Comp 1 ave. of 3 separte cuts

APPENDIX B

Tables and Graphs

P-4080: CDM Sample No. 5 (20% Sample 1, 20% Sample 2 and 60% Sample 3)
Results of Knelson GRG Test

	P95				Au Assay	Au Dist.	Dist
Test No.	microns		Product	wgt %	opt Product	opt of Ore	Au, %
1	1700		Knelson Con	0.21	9.60	0.020	23.82
	212		Knelson Con	0.06	11.13	0.006	7.35
	100		Knelson Con	0.09	12.64	0.011	13.44
			Knelson tail	99.64	0.0473	0.047	55.39
			Calc Head	100	0.085	0.085	100.00
			Assay Head		0.095
		Combined Products		0.36	10.61	0.038	44.61
		Knelson con

Comments: All Knelson con contained free au 50-300 microns in size

P-4080: CDM Sample No. 5 (20% Sample 1, 20% Sample 2 and 60% Sample 3)
Results of Knelson/Flotation Test Work : Conduct Knelson Gravity test (2 passes), then bulk sulfide flotation of the Knelson tails.

	Grind P80,		Knelson con			Knelson + 4 min Ro con				Ro tail		Calc Head
						Au Assay	Au Dist.
Test No.	microns	wgt %	Au, opt	Au Dist, %	wgt %	opt Product	opt of Ore	Au Dist, %	wgt %	Au, opt	Au Dist, %	Au, opt
5	82	0.15	9.13	16.9	4.7	1.20	0.057	71.3	95.3	0.024	28.8	0.079
4	103	0.10	10.63	12.0	3.5	1.82	0.064	71.9	96.5	0.026	28.1	0.089
3	144	0.07	12.48	11.0	2.7	2.28	0.061	73.2	97.3	0.023	26.8	0.084
2	187	0.16	9.83	17.4	2.2	3.25	0.071	79.0	97.8	0.019	21.0	0.090
6	226	0.51	4.51	26.6	2.5	2.56	0.063	73.3	97.5	0.024	26.7	0.086
7	270	0.51	4.11	24.0	2.6	2.46	0.063	71.6	97.4	0.024	28.4	0.088
8	354	0.63	5.54	37.4	2.6	2.57	0.068	72.2	97.4	0.024	27.8	0.094

APPENDIX C

Data Test Sheets

Appendix C

CAMP DRESSER & XXXXX, INC.

Final Report on Cleaner Flotation Test Work Conducted
on a Single Master Composite for Garnet Mining.

November 30, 2009

OUR PROJECT NO. P-4105

		TABLE OF CONTENTS
			Page No.
X.	Xxxxxx Description and Head Assays. . . . . . . . . . . . . . . . . . . . . . . .		. . .	2
II.	Test Results. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. .	3
	A.	Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. .	3
	B.	Confirming Test. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. .	3
	C.	Cleaner Test Results. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	4
	D.	Rougher Tails Assay Screen from Test 2. . . . . . . . . . . . . . . .	. . .	7
	E.	Mineralogy Results by DCM Science on Samples of Rougher		8
		Concentrate Hand Pan Tails and Rougher Tails from T-2A. ..	. .	8
III.	Test Procedures. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. . .	9
	A.	Confirming Batch Knelson Gravity Concentration/Bulk Sulfide
		Flotation Tests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	. . .	9
	B.	Large-scale 16 kg Knelson Gravity/Bulk Sulfide Flotation Tests.		9
IV.	Recommendations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		. . .	10

APPENDICES:
Appendix A -	Table, Graphs and Data Test Sheets
Appendix B -	DCM Science Laboratory, Inc. Mineralogy Report on
	Rougher Tails and Rougher Concentrate Hand Pan Tails

November 30, 2009

Camp Dresser & XxXxx Inc.
Chase Tower
00 Xxxx Xxxxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000-0000

Attention: Xx. Xxxxxxx Xxxxxxxxxx

Subject: Final Report on Cleaner Flotation Test Work Conducted on a Single Master Composite for Garnet Mining. Our Project No. P-4105.

Dear Xx. Xxxxxxxxxx,

DML was contracted by Camp Dresser & XxXxx (CDM) to perform cleaner flotation test work on a single Master Composite (MC) for Garnet Mining on a property located in Montana. The test work was conducted to evaluate the feasibility of upgrading bulk sulfide rougher flotation concentrates into a low weight, high purity gold bearing final concentrate that could possibly be processed on site to generate dore metal. The flotation feed material was Knelson gravity concentrator tails.

Previous test work under our project No. P-4080 was conducted on five individual samples from the Garnet Mining property. The work focused on gold recovery using a Knelson Gravity Bowl, followed by bulk sulfide flotation of the Knelson tailings. Gold recovery of the combined Knelson/flotation concentrate ranged from 57 to 98%. Gold grades of 0.7 to 22 opt combined product were obtained. A summary table of the results is presented below.

P-4080: CDM Garnet Mining
Samples 1-5: Results of Total Gold Recovery (Gravity + Flotation) at a Targeted P₈₀=190 µm

	Grind P₈₀,		Knelson Con + 8 min Flotation Con
	Grind P₈₀,		Au Assay,	Au Distribution,	Au Dist, %
Sample No.	Microns	Wgt %	opt product	opt of ore	Au Dist, %
1	176	4.0	3.71	0.15	98.4
2	182	4.0	2.90	0.12	72.6
3	185	3.8	0.68	0.03	57.4
4*	205	0.9	21.92	0.12	82.3
5	184	3.8	2.28	0.09	82.3
5**	187	2.2	3.25	0.07	79.0**

*Sample 4 contained significant free Au.
** Results based on 4 minutes of flotation time.

The overall gold recovery into the Knelson/rougher flotation concentrates was acceptable, but the gold grade was too low for possible on site processing into dore.

-2-

The following work was conducted in the current test program.

Conduct a confirming test on the current MC following the Knelson gravity/bulk sulfide flotation procedure used in the previous work (P-4080). The sample was ball mill ground to a P₈₀=191 microns.

Conduct 2 separate, 16 kg Knelson gravity tests on ball mill ground MC to a

P₈₀=190 microns, followed by bulk sulfide rougher flotation tests on each of the Knelson tails to generate rougher concentrates. The Knelson concentrate was hand pan for a final product.

Conduct two separate tests on the rougher concentrates.

			-	Conduct a single stage cleaner flotation test of the rougher concentrate without regrinding and at a natural pH=8 (T-2).
			-	Hand panned the rougher concentrate into a small weight hand pan concentrate (T-2A).

	·	Send the remaining rougher tails to CDM in Bellevue, WA for Geotech work.
	·	Conduct an assay screen test from a split of rougher tailings from T-2. Assay each fraction for gold.
	·	Have mineralogy work conducted by DCM Science on rougher tailing and rougher concentrate hand pan tails from T-2A, to determine the gold occurrence in each sample.

Sample Description and Head Assay

Twenty-one (21) individual samples ranging in weight from 0.5 to 6.2 kg were received at our lab on September 15, 2009 and assigned our project No. P-4105. The individual samples were labeled "Grant Hartford Corp." and appeared to be reverse circulation cuttings (RC). All of the individual samples were combined into a single Master Composite (MC) that weighed approximately 85 kg. The MC was stage crushed to 100% -10 mesh using a parallel rolls crusher. The entire -10 mesh sample was blended by cone and quarter and split into 25 kg batches. Each batch was sub split into 2.0 kg test charges using s spinning riffler.

A single test charge was sub split for head assays using a spinning riffler Assays conducted were Au (in triplicate), Ag, Cu, Fe, S_totaland S=. Gold was assayed by fire assay with a gravimetric finish; Ag, Xx and Fe were assayed by AA. Total sulfur was assayed using a Leco sulfur analyzer; S= was determined by a NaCO₃leach to dissolve SO₄species followed by sulfur determination using the Leco. The difference between Stotal and S= in the residue is the SO₄assay. Head assays are reported in the table below.

P-4105: CDM Garnet Mining
MC Head Assay Results

Cut	opt				%
Cut	Au	Ag	Cu	Fe	S_total	SSO₄	S=
1	0.050	<0.058	0.0314	2.92	0.217	0.042	0.175
2	0.068
3	0.174
Ave	0.097

Note: The variation in the gold head assays is due to free gold within the MC.

-3-

II.

Test Results

All flotation reagent dosages are reported in lb/ton of ore, unless otherwise stated.

All Knelson concentrates were hand panned using a vanning plaque resulting in a low weight, gold bearing hand pan concentrate and a hand panned tailings products. All hand panned tailings were combined with the Knelson gravity tailings. The hand panned concentrates are referred to in this report as Knelson concentrates. All hand pan concentrates were assayed for gold only (as total milligrams of gold) Test products were assayed for gold, silver iron and sulfur. Due to the low grades of silver and iron only gold (and some sulfur) results will be presented in the body of this report. Complete results are presented in detailed data tables and test sheets in the appendix at the end of this report.

II.A

Summary

Results of test work on the MC used in the current study were comparable to those obtained from Sample No. 5 (identified as a MC) from earlier work.

Free gold was observed in all hand pan and flotation concentrates, and varied in size from 750 microns to 50 microns in size. In general the average size of the free gold was 50 microns, and appeared to be of high purity.

A high gold grade cleaner flotation concentrate was not achieved during the current test program (no concentrate regrinding and at a pH=8). The concentrate contained primarily pyrite. No pyrite depressant(s) were added to this test.

A product containing 155 opt gold was obtained in a 0.02 weight percent combined Knelson hand pan and rougher concentrate hand pan concentrate. However the combined gold recovery was only 33%.

Based on results of a flotation tails assay screen test, gold remaining in the tails appears to be associated with non-sulfide gangue material.

II.B

Confirming Test

An initial confirming test was conducted on the MC using test conditions from the P- 4080 work. A 2.0 kg MC sample was ball mill ground to a P₈₀=191microns, then processed through a Knelson gravity concentrator. The Knelson concentrate was collected and hand panned for final Knelson concentrate. The hand panned tailings were combined with the Knelson gravity tailings and an 8 minute bulk sulfide flotation test was performed using Cytec A-208 and PAX (potassium amyl xanthate) at dosages of 0.02 lb/ton, each. MIBC frother was added at a dosage of 0.012 lb/t ore.

Result show that 82% of the total gold was recovered into the combined Knelson + 8 minute rougher flotation concentrates, that assayed 4.2 opt. This compares, from the previous work, of a gold recovery (from 2 tests) of 81% and gold grade of 2.8 opt at a P₈₀=186 microns.

-4-

A summary of the test results is presented in the following table.

P-4105: CDM Garnet Mining
Results of Confirming Test; Targeted P80=190 microns

	Grind P80,		Knelson Con + 8 min Flotation Con
Test	Grind P80,			Au Assay,	Au Distribution,	Au Dist	Ro Tails,	Calc. Head
No	Microns	Wgt %		opt product	opt of ore	%	Au, opt	Au, opt
No		Wgt %		opt product	opt of ore	%	Au, opt	Au, opt
2*	187	2.2		3.25	0.071	79.0**	0.019	0.090
14*	184	3.8		2.28	0.087	82.3	0.020	0.106
Ave	186	3.0		2.77	0.079	80.7	0.020	0.098
1	191	2.1		4.22	0.089	81.8	0.020	0.109
(P-4105)	191	2.1		4.22	0.089	81.8	0.020	0.109
(P-4105)
MC

*From previous P-4080 test work, Sample No. 5 was a composite sample.
** Based on 4 minutes of flotation time

II.C

Cleaner Test Results

Two separate 16 kg tests were conducted on the MC at a primary grind P80=191 microns to determine if a high gold grade, low weight final flotation concentrate could be produced. Both tests incorporated processing the ground ore using a Knelson gravity concentrator, followed by hand panning of the Knelson concentrate and bulk sulfide flotation of the Knelson + hand pan tails. The two test procedures are described below, with process flow diagrams presented on the following pages:

	·	Test 2: Conduct a single stage cleaner flotation test of the rougher concentrate without regrind the concentrate and at a natural pH (pH=8).
	·	Test 2A: Hand pan the rougher concentrate to generate a high gold grade low weight product.

Results from test 2 show that the No. 1 cleaner concentrate assayed 9.3 opt gold (in a 0.39 weight % product). This corresponds to a recovery of 43% gold. When combined with the Knelson concentrate, 59% of the total gold was recovered in a concentrate that assayed only 12.5 opt gold and 0.40 weight percent. Pyrite (liberated and locked with non-sulfide gangue) was the primary mineral in the cleaner concentrate. No pyrite depressant was added to the cleaner stage.

Results from test 2A show that a 509 opt Knelson concentrate was achieved in only a 0.002 weight % concentrate, which corresponded to a gold recovery of 14%. Only 18% of the total gold in the sample was recovered in the hand pan rougher flotation concentrate which assayed 100 opt gold. The combined Knelson + hand pan concentrate assayed 156 opt gold (in 0.018 weight %), but the gold recovery was only 33% gold. Greater than 48% of the gold was in the rougher concentrate hand pan tails. Samples of the rougher flotation tails and rougher hand pan tails from T-2A were submitted to DCM Science for mineralogy work, and are reported later in this report.

Results of the test work are presented in the following table.

-5-

NOTE: The hand pan concentrate contained free gold ranging in size from 250 to 1 piece 1500X 500 microns. All gold was nugget in shape and appeared to be of high gold purity.

** Tails assay an average of 2 separate sample cuts.

The Knelson concentrate weight from T-2A was approximately 5 times less then that from T-2, which resulted in a higher gold concentrate grade. However, the gold recovery in the product for both tests was comparable (16 vs 14%).

In both tests, free gold in the Knelson hand pan concentrate ranged in size from 250 to 750 microns. The free gold appeared to be of high purity. The free gold in the flotation concentrates was typically 50-250 microns in size (average of approximately 50 microns), and also appeared to be of high purity.

Additional work might focus on a flotation collector more selective against pyrite such as Cytec 3418A, or examine pyrite depressants such as lime to a pH=10-10.5 (excess lime is known to depress liberated free gold) or meta bi sulfite.

-6-

-7-

II.D

Rougher Tails Assay Screen from Test 2

A 200 gm sample of rougher tails from test 2 was split out and a gold assay screen test was performed. The purpose of this work was to determine the distribution of the gold remaining in the rougher flotation tails at the various size fractions. The results show that the gold is for most part evenly distributed throughout the -48 to +400 mesh (325 to 38 micron) fractions. Each fraction contained approximately 10% of the total gold. Greater than 32% of the gold reported in the -400 mesh (-38 micron) fraction. The gold and weight distributions are comparable and suggest that gold in the tails is in the gangue material; only 7% of the S_(total)remained in the rougher tails. Results from this work are reported in the following table and graph.

-8-

Xx. Xxxxxxxxxx requested that the remaining rougher tails be delivered to Ms. Xxxxx Xxxx-Xxxxx at CDM in Bellevue, Washington for geotech test work. Approximately 32 kg of solids (as a slurry) from T-2 and T-2A, along with a 5-gallon bucket of process water from the test work were sent November 10, 2009.

II.E

Mineralogy Results by DCM Science on Samples of Rougher Concentrate Hand Pan Tails and Rougher Tails from T-2A

Approximately 50 gm samples from T-2A rougher tails and rougher concentrate hand pan tails were split out using a spinning riffler and submitted to Xx. Xxx Xxxxxx of DCM Science, Wheat Ridge, CO for mineralogy evaluation using reflective/transmitted light microscopy and scanning electron microscopy with an energy dispersive system (SEM/EDS). The purpose of the work was to determine the gold occurrence (liberated, locking, etc.) in each sample.

-9-

Hand Pan Tails - Results from this work show gold mineralogy included in pyrite (pyrite is the dominant sulfide). A gold/silver telluride occurs as very small inclusions with a grain size of 1 to approximately 5 microns. Its occurrence in pyrite varies from single grains to small clusters and is seen in less than 1% of the pyrite grains. In addition an aggregate of gold telluride and galena was also identified with a grain size of approximately 15 microns. A small 15 micron grain of free gold was also detected using light microscopy.

Rougher Tails - Non-sulfide gangue (quartz, dolomite, plagioclase, etc.) dominate the rougher tails mineralogy. The sample contained a trace of sulfides (pyrite and pyrrhotite). Several sulfide grains were evaluated by SEM/EDS and carried no identifiable gold. However, one small 10 micron grain was identified with light microscopy as a free grain. SEM/EDS did identify a free grain of native silver and a small grain of argentite (AgS) included in a fragment of quartz.

Xx. Xxxxxx stated that he spend an exceptional amount of time examining the hand pan tails for liberated gold and was surprised that only one piece was identified.

III.

Test Procedures

III.A

Confirming Batch Knelson Gravity Concentration/Bulk Sulfide Flotation Tests

A 2.0 kg charge of the MC was ball mill ground at 60% solids using DML water and a 10 kg ball mill charge to a P₈₀=191 microns. The ground slurry was processed using a Knelson gravity concentrator. The Knelson concentrate was collected and hand panned using a vanning plaque to produce a final Knelson concentrate. The Knelson concentrate was assayed for total milligram of gold. The hand panned tails were combined with the Knelson tail. The Knelson tails were filtered and the solids put into a flotation cell.

All flotation work was conducted using an Agitair 2.0 kg mechanical flotation cell operating at 800 rpm. Flotation reagents Cytec A-208 and potassium amyl xanthate (PAX) were added as 1% solutions. A total of 0.02 lb/t ore of each reagent was added in 3 stages. MIBC frother was added at full strength. A bulk sulfide flotation concentrate was collected after 8 minutes of flotation time.

III.B

Large-scale 16 kg Knelson Gravity/Bulk Sulfide Flotation Tests

Eight (8), 2.0 kg MC test charges were ball mill ground (10 kg ball charge) to a targeted P80=190 microns for each of the 16 kg tests. The ground 16 kg material was processed in the Knelson Concentrator in four (4), 4 kg batches. The Knelson concentrate from each 4 kg batch was combined and hand panned to generate a hand pan concentrate. The hand pan tails were combined with the Knelson tails for rougher flotation feed.

The rougher feed was placed in 40 L Agitair flotation cell. Flotation reagents Cytec A- 208 along with PAX (potassium amyl xanthate) were stage added for a total dosage of 0.02 lb/ton feed each. MIBC frother was added at a dosage of 0.017 lb/ton feed. The flotation concentrate was collected after 16 minutes of flotation time.

-10-

The rougher concentrate collected from test 2 was placed in a 500 gm Agitair flotation cell and 5minute single stage of cleaner flotation was conducted. A dosage of 0.005 lb/t A-208 was added after 5 minutes and a separate cleaner scavenger concentrate collected.

The rougher concentrate from test 2A was hand panned and a rougher concentrate hand pan concentrate and tails was collected.

All hand pan concentrates were assayed only for gold (as total milligrams of gold).

IV.

Recommendations

Additional cleaner flotation work of the rougher concentrate could be conducted using a Gemini Table in an attempt to recover the free gold in a low weight, high gold grade concentrate. Unfortunately, DML does not have a Gemini Table, but may have access to one available at Xxxxx Research.

Cleaner flotation work could be conducted on rougher flotation concentrates to depress the pyrite. Depressants such as lime (at a pH=10-10.5), meta bisulfite, etc could be evaluated. It should be noted that excess amounts of lime in flotation circuits is known to depress free gold. This work could be performed on reground or non-reground rougher concentrate.

A more selective collector, such as Cytec 3418A could be tested in the rougher flotation circuit. This reagent is noted for its' selectivity against pyrite.

If you have any questions about this report, please contact me.

Sincerely,
FLSmidth Xxxxxx Metallurgical Laboratories

/s/Xxxx X. Xxxxxxx

Xxxx Xxxxxxx
Operation Manager

U:\My Documents\CDM\4105\final report.doc

Appendix A

Table, Graphs and Data Test Sheets

Appendix B:

DCM Science Laboratory, Inc. Mineralogy Report on Rougher Tails and Rougher Concentrate Hand Pan Tails

DCM Science Laboratory, Inc.
00000 X. 00xx Xxxxxx, Xxxx #0
Xxxxx Xxxxx, XX 00000 (303) 463-8270

Petrographic/Scanning Electron Microscopy Analysis
Page 1 of 11

Client:	Analysis Date:	11-17-09
Xxxxxx Metallurgical Laboratories, Inc.	Reporting Date:	11-18-09
0000 X. Xxxxxxx Xxxx, Xxxxx 00	Receipt Date:	11-9-09
Salt Lake City, UT 84116	Client Job No.:	P-4105
	Project Title:	None Given
	DCMSL Project:	DML11-12

The purpose of this project is to determine the bulk mineralogy of two test products (client samples Rougher Tails and Pan Tails) with an emphasis on gold mineralogy. A standard thin section was prepared for each sample for study by reflected/transmitted light microscopy and scanning electron microscopy equipped with an energy dispersive system (SEM/EDS). Color photomicrographs, SEM images and EDS spectra are included for documentation.


Client Sample No.:		Rougher Tails
Mineralogy:	Quartz 30%		Dolomite 20%		Plagioclase 12%		K-Feldspar 10%	Biotite 10%
	Chlorite 8%		Calcite 5%		Amphibole 5%	Pyrite/Pyrrhotite <1%
	Magnetite/Ilmenite <1%			Silver/Argentite <1%			Gold <1%

In thin section silicates are the dominant phase. Quartz occurs as angular fragments and mosaic aggregates that vary greatly in size from 10µm up to 400µm. Quartz shows some attachment to feldspar. Feldspar includes both plagioclase and k-feldspar that have individual grain measurements between 10µm and 400µm. Some of the feldspar display mild seritization. Iron silicates are well represented and include amphibole, biotite mica and chlorite. Amphibole tends to be the coarsest and occurs as cleavage fragments and stubby prisms up to 500µm. Biotite and chlorite are often intergrown and reach dimensions up to 300µm. Associated with the iron silicates are traces of magnetite and ilmenite with a grain size that does not exceed 150µm. Some magnetite shows mild hematite alteration. Carbonate is represented by calcite and dolomite. Dolomite is fairly coarse with a grain size up to 400µm. Calcite is much finer with an upper grain size in the 100µm range. A trace of sulfide mineralogy is present and includes pyrite and pyrrhotite. Both sulfides are in the 25µm to 100µm grain size. Several grains were evaluated by SEM/EDS and carry no identifiable gold. However, one small 10µm grain was identified with light microscopy as a free grain. SEM/EDS did identify a free grain of native silver and a small grain of argentite included in a fragment of quartz.

DML11-12 - page 2 of 11

Surrounded by silicates is a bright grain of native silver - 1100X.

DML11-12 - page 3 of 11

A bright grain of argentite included in quartz - 2000X.

DML11-12 - page 4 of 11

Photo 2 - Fractured grain of pyrrhotite. Reflected light - 200X.

DML11-12 - page 5 of 11

Photo 4 - Area photo showing silicates and colorful carbonate. Plane light - 100X.


DML11-12 - page 6 of 11
Client Sample No.:		Pan Tails
Mineralogy:	Pyrite 25%		Calcite 17%		Dolomite 13%	Quartz 11%	Chlorite 8%
	Biotite 7%		Plagioclase 7%		K-Feldspar 6%	Amphibole 3%		Chalcopyrite 1%
	Galena 1%		Pyrrhotite 1%		Bornite <1%	Magnetite/Ilmenite <1%
	Petzite (?) <1%			Gold <1%

Like the previous sample, this sample is largely composed of non-sulfide phases but tends to be much finer grained. Carbonate is well represented and measures from 2µm up to 50µm for most grains. However, some dolomite fragments measure up to 200µm. Quartz occurs as angular fragments that rarely measure beyond 200µm. Feldspar is also very fine grained with measurements in the 2µm to 50µm range. Amphibole is generally seen as small cleavage fragments and biotite/chlorite usually occurs as single platelets in the 10µm to 80µm range. A trace of magnetite/ilmenite occurs as small 20µm to 50µm grains. Sulfide mineralogy is well represented and varied. Pyrite is the dominant sulfide and has the coarsest texture. Grains are generally angular, measure from 2µm to 400µm and show good liberation from other phases. Chalcopyrite, pyrrhotite and galena also show good liberation and typically measure from 2µm up to a maximum of 200µm. A trace of bornite is present and does not exceed 100µm in size. SEM/EDS indicates the presence of gold mineralogy included in pyrite. A gold/silver telluride that likely represents petzite occurs as very small inclusions with a grain size of 1µm to approximately 5µm for the largest grains. Its occurrence in pyrite varies from single grains to small clusters and is seen in less than one percent of the pyrite grains. In addition an aggregate of gold telluride and galena was also identified with a grain size of approximately 15µm. A small 15µm grain of free gold was also detected using light microscopy.

DML11-12 - page 7 of 11

DML11-12 - page 8 of 11

DML11-12 - page 9 of 11

DML11-12 - page 10 of 11

DML11-12 - page 11 of 11

Appendix D

CAMP DRESSER & XxXXX, INC.

Final Report on Gravity, Flotation and Cyanidation Test Work on Xxxxxx and Xxxxx Xxxxx Composites from Garnet Mining.

May 13, 2010

OUR PROJECT NO P-4137

		Table of Contents
			Page No.
X.	Xxxxxx Description and Head Assays. . . . . . . . . . . . . . . . . . . . . . . .		2
II.	Test Results. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		3
	A.	Summary. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	4
	B.	Confirming Knelson Gravity/Bulk Sulfide Flotation
		on Each Sample. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	5
	C.	MC Selective Flotation Reagent Test Results. . . . . . . . . . . . .	5
	D.	Confirming Tests on Each Sample. . . . . . . . . . . . . . . . . . . . .	7
	X.	Xxxxxxx Cyanide Xxxxx Test Results. . . . . . . . . . . . . . . . . . . .	8
	F.	Generating Flotation Tails for CDM. . . . . . . . . . . . . . . . . . . .	9
III.	Test Procedures . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		9
	A.	Confirming Knelson Gravity Concentration/Bulk Sulfide
		Flotation Tests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
	B.	Selective Flotation Reagent Tests. . . . . . . . . . . . . . . . . . . . . .	9
	C.	Confirming Tests. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .	9
	D.	48 Hour Kinetic Cyanide Xxxxx Tests. . . . . . . . . . . . . . . . . . .	10
IV.	Recommendations. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .		10

APPENDICES:

Appendix A - Individual Samples Used to Make the Xxxxxx and Xxxxx Xxxxx Composites ICP Scan Head and Flotation Product Assay Results

Appendix B - Data Tables, Graphs and Test Flow Diagrams

Appendix C - Data Test Sheets

May 13, 2010

Camp Dresser & XxXxx Inc.
Chase Tower
00 Xxxx Xxxxxxxx, Xxxxx 0000
Xxxx Xxxx Xxxx, Xxxx 00000-0000

Attention: Xx. Xxxxxxx Xxxxxxxxxx

Subject: Final Report on Gravity, Flotation and Cyanidation Test Work on Xxxxxx and Xxxxx Xxxxx Composites from Garnet Mining. Our Project No. P- 4137.

Dear Xxxxxxx,

DML was contracted by Camp Dresser & XxXxx (CDM) to perform metallurgical tests on individual composites designated as Xxxxxx and Xxxxx Xxxxx, and an equal weight composite of the two samples, designated as Xxxxxx/Xxxxx Xxxxx Master Composite (MC). The purposed of the work was to determine total gold (Au) recovery on each sample and the MC using previously established test procedures.

Previous test work had been conducted in 2009 on samples from Garnet Mining. The work focused on recovery of gold from a MC and individual samples using a Knelson Gravity Bowl, followed by bulk sulfide flotation of the Knelson tailings. Results from this work show that Au recovery ranged from 57 to 98% at targeted grind P80=190 microns. Results are presented in a report dated August 11, 2009, under our project No. P-4080.

A second tests program on a MC was outlined to evaluate the feasibility of upgrading bulk sulfide rougher flotation concentrates from Knelson gravity tails into a low weight, high purity gold bearing final concentrate that could possibly be processed on site to generate dore metal. A cleaner concentrate was generated that contained 9.3 opt Au (Au recovery=43%) into a 0.4 weight percent product. Results from this work are presented in a report dated November 30, 2009, under our project No. P-4105.

-2-

The following work was conducted in the current test program.

	·	Conduct a confirming test on each composite following the Knelson gravity/bulk sulfide flotation procedure used in previous work (P-4080). Each sample was ball mill ground to a targeted P₈₀=190 microns.
	·	The average Au assay grade was 0.098 opt.
	·	Conduct a gravity/flotation test on Xxxxxx and Xxxxx Xxxxx composites using the best flotation reagent established above.
	·	Conduct a 48 hour NaCN kinetic cyanide xxxxx test on each composite ground to a targeted 35% +100 mesh (150 microns) using 2 lb NaCN/t solution at 30 % solids and pH=11.3 (adjusted w/ Ca(OH)2).
	·	Generate approximately 2 kg of MC flotation tailings using "optimum" flotation conditions. Ship the tailings to CDM's office in Helena, Montana.

Sample Description and Head Assay

Seven (7) individual Xxxxx Xxxxx and eight (8) individual Xxxxxx samples were received at our lab on January 27, 2010. The individual samples weighed 1.4 to 5.8 kg (3.1 to 12.8 lb) with a top size of approximately of 0.64 cm (1/4 inch). The individual samples were combined into the respective composites and stage crushed to -10 mesh separately. Each was blended and split into 1.0 kg test charges. A list of the samples is presented in the appendix at the end of this report.

A single test charge from each was sub split for head assay. Each was assayed for Au (2

separate cuts), Ag, Pt, Pd, Cu, Fe, As, S(t), S=. Gold was assayed by fire assay with a gravimetric finish; Ag, Xx and Fe were assayed by AA. Pt and Pd by ICP. Total sulfur

was assayed using a Leco sulfur analyzer; S= was determined by a NaCO₃leach to dissolve SO₄species followed by sulfur determination using the Leco. The difference

between S_totaland S= in the residue is the SO₄assay. Head assays are reported in the following table.

-3-

Xx. Xxxxxxxxxx had stated that if the Au head grade for either of the composites was less than 0.2 opt (too low grade), then wait on conducting any test work. After reporting the head assay results, Xx. Xxxxxxxxxx said that additional higher Au grade intervals for each composite would be sent, and new composited constructed.

Two Xxxxxx and four Xxxxx Xxxxx individual high Au grade intervals were received at DML on March 15, 2010. The new intervals were stage crushed to -10 mesh, and then blended with 24 kg of either the original Xxxxxx or Xxxxx Xxxxx to yield "new" Xxxxxx and Xxxxx Xxxxx composites. The same suite of assays as previously conducted (except for Pt and Pd) was performed on the "new" composites. In addition, an ICP scan was conducted on a separate cut for each composite. Head assay results are reported in the following table. The ICP scan results are reported in the appendix.

The "new" individual composites contained sufficient Au and are were used for the remainder of the test series. Each composite contained free gold (average of 50-100 microns), along with minor amounts of pyrite.

II.

Test Results

All flotation reagent dosages are reported in lb/ton of ore, unless otherwise stated.

All Knelson concentrates were hand panned using a vanning plaque resulting in a low weight, gold bearing hand pan concentrate and a hand panned tailings products. All hand panned tailings were combined with the Knelson gravity tailings. The hand panned concentrates are referred to in this report as Knelson concentrates. All hand pan concentrates were assayed for gold only (as total milligrams of gold) Test products were assayed for gold, silver, iron and sulfur. Only Au will be reported in this report. Complete results are presented in detailed data tables and test sheets in the appendix at the end of this report.

-4-

II.A

Summary

Tests conducted on the individual composites show that 96% of the gold reported in combined Knelson gravity/bulk sulfide flotation concentrates. Approximately 40% of the total Au reported to the Knelson concentrate. The combined concentrates assayed an average of 9.5 opt Au. Comparable results were obtained on work performed on the MC. All gravity hand pan concentrates contained free gold that ranged in size from 50 to 2500 microns. The average Au size was 50- 100 microns reporting to test products. A summary of the results is presented in the following table.

Results of the selective flotation reagent test work show that there was not a distinct "winner" in producing a high Au grade flotation concentrate from the Knelson gravity tails. Results show that flotation concentrate Au grades ranged from 3.7 to 8.3 opt Au; recovery ranged from 28 to 36% Au. Results are presented in the following table.

	·	Confirming tests on each composite using the Knelson gravity/3418A/bulk sulfide flotation scheme show that greater than an 94% of the Au was recovered into combined concentrates, which assayed an average of 8 opt Au.
	·	Kinetic bottle roll cyanide xxxxx results on each composite show that 91% of the gold in the Xxxxxx composite and 96% of the Au in the Xxxxx Xxxxx composite was leached after 48 hours using 2 lb NaCN/t solution strength at 30% solids and a targeted grind of 35% +100 mesh (150 microns).

-5-

II.B

Confirming Knelson Gravity/Bulk Sulfide Flotation on Each Sample

A 2.0 kg sample of each Xxxxxx and Xxxxx Xxxxx composite was ball mill ground separately to a targeted P₈₀=190 microns at natural pH. Each ground sample was processed separately through a Knelson gravity concentrator. Each Knelson concentrate was collected and hand panned for final Knelson concentrate. The hand panned tailings were combined with the Knelson gravity tailings and an 8 minute bulk sulfide flotation test was performed on each sample at natural pH=7.4 to 7.8 using Cytec A-208 and PAX (potassium amyl xanthate) at dosages of 0.02 lb/ton, each. MIBC frother was added at a dosage of 0.06 lb/t ore.

Result show that 96% of the total gold was recovered into the combined Knelson + 8 minute rougher flotation concentrates for both samples. The combined concentrates assayed from 8.1 to 11.0 opt Au. This compares to previous work (P-4105 MC), to a gold recovery of 82% and gold grade of 4.2 opt at a P80=191 microns. A summary of the results is presented in the following table.

II.C

MC Selective Flotation Reagent Test Results

Test work was conducted to evaluate three (3) Au flotation reagents selective against pyrite recovery. The purpose of this work was to determine if a high Au grade, low weight flotation concentrate could be produced from Knelson gravity tails. A six (6) kg MC sample was ground to a P80=200 microns. The ground sample was processed through the Knelson gravity concentrator and a final hand panned concentrate produced. The gravity + hand panned tails were combined and split into 3 aliquots using a slurry splitter. The aliquots were used as flotation feed for the selective reagent test work.

Three reagents were examined at a total dosage of 0.005 lb/t ore/test:

			·	T-5A - Cytec A-208 (dithiophosphate)
			·	T- 5B - Cytec 3418A (dithiophosphinate)
			·	T-5C - Cytec XD-5002 (modified thionocarbamate)

After the selective flotation stage, bulk sulfide flotation was conducted using 0.02 lb/ton A-208 and 0.02 lb/ton PAX. MIBC frother was added as required. A flow diagram of the test procedure (with results from T-5B as an example) is presented on the following page.

-6-

-7-

Results show that from 28 to 36% Au was recovered into concentrates from the selective reagent stage. The concentrate Au grades ranged from 3.7 to 8.3 opt. Concentrate weight ranged from 1.5 to 3.0. Results are presented in the following table.

Flotation concentrates from each selective reagent test contained fine free gold that averaged 50-100 microns in size along with significant pyrite. Cytec reagent 3418A yielded the highest Au recovery (36%) into the flotation concentrate, yet the Au grade was only 6.4 opt. Since 49-58% of the total gold was recovered in the gravity concentrate, it may be difficult to produce a low weight, high Au grade flotation concentrate from the MC gravity tails.

II.D. Confirming Tests on Each Sample

A 2.0 kg confirming test was conducted using each composite following the Knelson gravity/3418A/bulk sulfide flotation scheme as outlined above. Results show that greater than 94% of the Au was recovered in combined gravity flotation concentrates. A summary of the results is presented in the following table.

-8-

II.E

Kinetic Cyanide Xxxxx Test Results

A 48 hour kinetic bottle roll cyanide xxxxx test was conducted on each sample ball mill ground to a targeted 35% +100 mesh (150 microns) using test conditions provided by CDM. Each test was performed at 30% solids, a pH=10.8 to 11.3 (adjusted w/Ca(OH)₂) using 2 lb NaCN/t solution strength. Small solution samples were taken at 4, 8 and 24 hours, and assayed for Au. A second solution sample was taken at the same times, titrated for free cyanide, and adjusted to 2 lb NaCN/t solution if necessary.

Results show that 91% of the Au from the Xxxxxx sample and 96% of the gold from the Xxxxx Xxxxx sample was extracted after 48 hours. Greater than 80% of the total Au leached from each sample was extracted after 24 hours. Results are reported in the following table and kinetic curves.

-9-

II.F

Generating Flotation Tails for CDM

A 2 kg bulk sulfide flotation test on the MC was conducted to generate rougher flotation tails for CDM personnel in Xxxxxx Xxxxxxx. The test employed 0.02 lb/t each of A-208 and PAX with 8 minutes of flotation time. The tails (1.9 kg) were filtered, dried at 50oC and sent to Xx. Xxxxx Xxxxxxxxx at CDM's office in Helena, Montana.

III.

Test Procedures

III.A

Confirming Knelson Gravity Concentration/Bulk Sulfide Flotation Tests

All flotation work was conducted using an Agitair 2.0 kg mechanical flotation cell. A 2.0 kg charge of the MC was ball mill ground at 60% solids using DML water and a 10 kg ball mill charge to a targeted P₈₀=190 microns. The ground slurry was processed using a Knelson gravity concentrator. The Knelson concentrate was collected and hand panned using a vanning plaque to produce a final Knelson concentrate. The Knelson concentrate was assayed for total milligram of gold. The hand panned tails were combined with the Knelson tail. The Knelson tails were filtered and the solids put into a 2.0 kg Agitair flotation cell operating at 800 rpm. Flotation reagents Cytec A-208 and potassium amyl xanthate (PAX) were added as 1% solutions. A total of 0.02 lb/t ore of each reagent was added in 3 stages. Concentrate samples were taken at 2, 4 and 8 minutes of flotation time. MIBC frother was added at full strength.

III.B

Selective Flotation Reagent Tests

Six (6), 1.0 kg test charges of MC were ball mill ground to P₈₀=200 microns and processed using the Knelson gravity concentrator as described above. The Knelson + hand pan tails were combined and poured into a slurry splitter. The splitter generated three (3) aliquots of slurry for the reagent scoping tests. Each aliquot was a separate test. An 2.0 kg Agitair flotation cell was used for the flotation work. A total of 0.005 lb/t selective reagent was added and flotation concentrate samples collected after 1 and 2 minutes. After 2 minutes Cytec A-208 and PAX were stage added at a total of 0.02 lb/t ore of each for the bulk sulfide flotation step.

III.C

Confirming Tests

The same Knelson/3418A/bulk sulfide test procedure as outlined in the above sections was employed on a 2.0 kg charge of each composite.

-10-

III.D

48 Hour Kinetic Cyanide Xxxxx Tests

A 1.0 kg composite of each was ball mill ground separately to a targeted of 35% + 100 mesh (150 microns) and placed in a 1 gallon glass bottle for the cyanide bottle roll xxxxx test. The slurry was adjusted to 30% solids, and pH =11.3 (with Ca(OH)₂). Sodium cyanide was added at a concentration of 2 lb NaCN/t solution strength. Two (2), small aliquots of xxxxx solution were taken at 4, 8 and 24 hours. One sample was assayed for Au, the second sample was titrated for free CN. The NaCN concentration was adjusted to 2 lb NaCN/t solution if necessary. In addition, the pH of the slurry was recorded and adjusted to 11.3 if necessary.

At the end of the xxxxx, the slurry was filtered, and full strength xxxxx solution collected. The xxxxx residue was washed with 4 displacements of warm water to remove residual NaCN. The washed residue was dried, weighed and assayed for Au.

IV.

Recommendations

Ore variability test work should be conducted on a variety of samples that represents the ore body. Tests work would consist of the process scheme used to date.

			·	Ball mill grind to a targeted P₈₀=190 microns
			·	Knelson gravity work to recovery free gold
			·	Bulk sulfide flotation of the Knelson/hand pan tails

I have enjoyed working on this project. If you have any questions or comments about this report please contact me.

Sincerely,
FLSmidth Salt Lake City

/s/Xxxx X. Xxxxxxx

Xxxx Xxxxxxx
Operations Manager

U:\My Documents\CDM\4137\4137 final report.doc

APPENDIX A

Individual Samples used to Make the Xxxxxx and Xxxxx Xxxxx Composites
&
ICP Scan Head and Flotation Product Assay Results

APPENDIX B

Data Tables, Graphs and Test Flow Diagrams

APPENDIX C

Data Test Sheets

Appendix E

Appendix F

Average Gold Price 3 - Year End
December 31, 2010

2008	2009	2010
846.75	874.5	1121.5
$858.85	$853.50	$1,123.25
$855.00	$848.25	$1,130.00
$859.25	$848.50	$1,130.25
$873.50	$855.75	$1,126.75
$877.00	$847.25	$1,153.00
$884.25	$827.00	$1,151.25
$891.00	$826.50	$1,127.25
$902.00	$821.50	$1,138.25
$913.00	$810.00	$1,128.00
$889.75	$833.75	$1,134.50
$888.25	$833.00	$1,133.00
$882.00	$853.25	$1,120.25
$871.25	$849.25	$1,108.25
$875.00	$860.00	$1,084.00
$888.25	$875.75	$1,095.25
$909.25	$910.25	$1,093.25
$918.25	$897.50	$1,094.75
$921.75	$895.25	$1,088.00
$924.50	$892.25	$1,078.50
$919.00	$919.50	$1,086.50
$923.25	$918.25	$1,111.00
$914.75	$904.50	$1,115.25

2008	2009	2010
$893.75	$905.00	$1,083.25
$887.50	$920.00	$1,058.00
$903.00	$913.00	$1,064.00
$899.75	$895.00	$1,071.25
$916.25	$909.75	$1,069.50
$918.00	$938.00	$1,076.25
$917.00	$943.25	$1,082.00
$899.00	$935.50	$1,098.25
$906.00	$942.50	$1,115.25
$912.50	$968.00	$1,119.00
$903.25	$964.00	$1,118.00
$924.00	$980.50	$1,112.75
$920.00	$989.00	$1,115.25
$945.00	$985.75	$1,107.00
$943.00	$984.25	$1,103.00
$937.75	$978.50	$1,094.50
$937.00	$936.50	$1,108.25
$959.50	$952.00	$1,114.00
$959.75	$937.25	$1,126.50
$971.50	$913.75	$1,136.50
$988.50	$908.50	$1,134.50
$984.75	$913.00	$1,135.00
$974.50	$936.00	$1,125.75
$976.50	$923.75	$1,115.75
$972.50	$901.50	$1,120.50

2008	2009	2010
$969.25	$899.50	$1,104.00
$970.00	$925.25	$1,106.25
$975.50	$928.00	$1,104.25
$995.00	$919.50	$1,124.75
$1,003.50	$915.50	$1,121.75
$1,011.25	$893.25	$1,122.75
$1,006.75	$956.50	$1,105.50
$958.50	$954.00	$1,097.75
$925.75	$949.25	$1,101.50
$926.75	$923.75	$1,090.75
$946.75	$929.00	$1,093.00
$946.75	$938.25	$1,096.50
$934.25	$924.00	$1,107.50
$933.50	$928.00	$1,107.00
$887.75	$916.50	$1,115.50
$890.00	$924.50	$1,123.50
$896.50	$897.75	$1,132.75
$905.50	$905.00	$1,142.00
$926.50	$870.25	$1,148.00
$915.00	$879.75	$1,152.50
$917.00	$880.00	$1,158.75
$928.00	$880.50	$1,148.25
$927.75	$887.50	$1,153.75
$926.50	$891.00	$1,154.50
$929.75	$880.50	$1,151.50

2008	2009	2010
$945.00	$870.50	$1,136.25
$946.00	$877.00	$1,144.75
$908.75	$888.75	$1,143.00
$918.50	$886.00	$1,133.75
$918.00	$897.50	$1,139.50
$898.50	$907.50	$1,154.50
$895.50	$907.50	$1,149.50
$891.50	$891.00	$1,161.00
$890.50	$898.25	$1,166.75
$880.00	$883.25	$1,179.25
$871.00	$884.50	$1,185.00
$853.00	$910.00	$1,165.00
$853.50	$910.00	$1,185.25
$880.00	$912.25	$1,202.25
$868.25	$907.00	$1,196.50
$877.00	$913.00	$1,222.50
$876.00	$917.00	$1,237.50
$883.50	$924.00	$1,237.50
$865.00	$925.25	$1,236.50
$866.50	$929.50	$1,236.00
$881.25	$921.00	$1,216.75
$897.00	$924.75	$1,195.00
$906.50	$939.50	$1,192.00
$914.50	$937.50	$1,179.75
$923.00	$959.75	$1,187.00

2008	2009	2010
$922.75	$945.00	$1,198.25
$927.50	$951.00	$1,212.00
$906.75	$957.75	$1,211.00
$902.50	$975.50	$1,207.50
$883.00	$981.75	$1,227.75
$885.75	$980.00	$1,215.00
$888.25	$976.75	$1,215.00
$879.25	$970.75	$1,203.50
$883.50	$962.00	$1,215.00
$878.75	$943.75	$1,246.00
$890.50	$956.00	$1,233.50
$896.25	$953.75	$1,217.50
$878.00	$947.50	$1,220.00
$876.25	$937.25	$1,223.75
$862.25	$932.25	$1,225.00
$866.00	$934.00	$1,234.50
$888.25	$930.50	$1,245.00
$881.50	$940.50	$1,256.00
$887.50	$935.25	$1,254.50
$903.00	$919.25	$1,236.00
$907.50	$920.75	$1,226.50
$881.00	$933.50	$1,236.25
$889.50	$937.25	$1,254.00
$882.75	$942.00	$1,261.00
$909.50	$935.50	$1,234.50

2008	2009	2010
$919.50	$934.50	$1,244.00
$930.25	$938.25	$1,234.00
$937.50	$929.50	$1,201.50
$935.25	$932.50	$1,208.00
$934.00	$924.50	$1,195.00
$931.25	$924.00	$1,193.25
$916.75	$918.00	$1,193.50
$921.00	$911.75	$1,208.75
$927.25	$913.00	$1,205.50
$939.50	$908.50	$1,216.00
$962.75	$924.75	$1,207.00
$968.00	$938.00	$1,208.00
$986.00	$935.00	$1,189.25
$977.50	$937.50	$1,181.00
$965.50	$952.75	$1,183.00
$959.75	$947.75	$1,191.50
$960.50	$948.25	$1,199.50
$961.50	$950.00	$1,190.50
$926.50	$951.50	$1,183.50
$928.00	$955.00	$1,168.00
$920.50	$944.25	$1,157.00
$923.50	$931.00	$1,162.50
$916.75	$932.50	$1,169.00
$897.50	$939.00	$1,188.50
$918.00	$959.75	$1,187.50

2008	2009	2010
$912.50	$960.50	$1,199.50
$905.75	$960.50	$1,192.50
$882.00	$964.00	$1,207.75
$879.50	$956.00	$1,203.00
$871.50	$945.00	$1,192.50
$852.50	$942.75	$1,205.50
$852.50	$947.25	$1,213.00
$817.75	$953.50	$1,214.25
$818.50	$953.50	$1,223.50
$818.00	$932.75	$1,226.00
$786.50	$935.00	$1,218.00
$796.25	$943.00	$1,233.50
$788.75	$940.50	$1,223.50
$815.75	$952.50	$1,226.00
$833.50	$951.50	$1,222.00
$824.00	$950.50	$1,237.50
$827.00	$940.50	$1,237.00
$827.00	$943.00	$1,235.00
$838.25	$955.50	$1,246.00
$833.00	$955.00	$1,246.50
$822.25	$964.75	$1,248.50
$798.50	$983.00	$1,240.50
$803.50	$989.00	$1,249.00
$805.75	$993.00	$1,256.75
$808.50	$1,000.75	$1,255.00

2008	2009	2010
$808.00	$999.50	$1,255.00
$781.75	$990.75	$1,246.50
$775.75	$1,008.25	$1,243.75
$740.75	$999.25	$1,265.50
$750.25	$996.00	$1,267.00
$775.00	$1,015.75	$1,272.50
$779.50	$1,018.50	$1,274.00
$813.00	$1,012.00	$1,279.25
$863.00	$997.00	$1,275.00
$869.00	$1,014.00	$1,293.50
$889.00	$1,010.25	$1,290.75
$899.00	$1,009.75	$1,297.00
$896.00	$991.50	$1,297.00
$888.50	$991.75	$1,294.00
$902.00	$989.50	$1,307.50
$905.00	$995.75	$1,307.00
$884.50	$1,004.75	$1,316.25
$880.00	$1,003.50	$1,313.50
$852.00	$1,005.50	$1,330.50
$828.00	$1,038.75	$1,346.50
$875.50	$1,040.25	$1,345.00
$876.75	$1,045.00	$1,341.50
$903.50	$1,051.50	$1,351.50
$883.50	$1,058.75	$1,348.50
$900.50	$1,057.50	$1,365.50

2008	2009	2010
$831.50	$1,059.50	$1,373.25
$832.50	$1,053.50	$1,367.50
$847.00	$1,047.50	$1,367.25
$802.50	$1,050.50	$1,339.00
$784.50	$1,061.75	$1,339.00
$795.00	$1,053.75	$1,343.50
$772.00	$1,053.00	$1,322.50
$744.00	$1,061.75	$1,337.50
$720.00	$1,054.00	$1,329.50
$712.50	$1,036.50	$1,324.50
$730.50	$1,031.75	$1,333.50
$730.50	$1,040.50	$1,346.75
$764.00	$1,040.00	$1,354.50
$755.25	$1,062.00	$1,351.00
$730.75	$1,061.00	$1,345.50
$729.50	$1,090.00	$1,381.00
$741.25	$1,089.00	$1,395.50
$753.75	$1,096.75	$1,388.50
$754.50	$1,106.75	$1,421.00
$735.25	$1,101.50	$1,390.50
$753.00	$1,115.25	$1,398.50
$733.75	$1,114.75	$1,388.50
$724.75	$1,104.00	$1,368.50
$713.50	$1,130.00	$1,349.00
$747.50	$1,134.75	$1,337.50

2008	2009	2010
$734.00	$1,149.00	$1,350.25
$738.00	$1,135.50	$1,342.50
$762.00	$1,140.00	$1,356.50
$738.00	$1,169.50	$1,377.50
$774.50	$1,163.25	$1,372.50
$822.50	$1,179.75	$1,373.25
$820.50	$1,182.75	$1,355.00
$812.50	$1,166.50	$1,357.00
$814.00	$1,175.75	$1,383.50
$814.50	$1,192.50	$1,385.50
$778.00	$1,212.50	$1,389.00
$780.00	$1,208.75	$1,403.50
$766.25	$1,190.25	$1,415.25
$773.25	$1,142.50	$1,420.00
$749.00	$1,146.75	$1,385.50
$767.25	$1,141.00	$1,391.25
$767.75	$1,128.50	$1,375.25
$802.25	$1,124.00	$1,399.00
$827.75	$1,123.75	$1,394.50
$826.50	$1,122.00	$1,388.75
$826.00	$1,137.50	$1,363.00
$838.25	$1,117.00	$1,368.50
$870.00	$1,104.50	$1,380.00
$855.25	$1,105.50	$1,383.00
$835.75	$1,084.00	$1,387.00

2008	2009	2010
$849.00	$1,085.25	$1,373.50
$843.50	$1,106.00	$1,412.50
$880.25	$1,087.50	$1,405.50
$869.00		$1,410.25
$219,733.85	$244,059.50	$308,765.50
$871.96	$972.35	$1,225.26

Appendix G

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Table of Contents

Appendix A Material Terms of Related Party Agreements (provided by David Rodli, General Counsel, Grant Hartford Corporation)

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