Fortress Base Metals Corporation - Kelly Creek

Executive Summary

This report reviews results of exploration within the area now covered by mineral claims Kelly 1 to Kelly 4 and K.C.1 to K.C.4 (the property), reviews exploration potential and makes recommendations for further exploration to test the property for economic mineral deposits.

This report was prepared at the request of Mr. Stephen Stanley, President, Aumega Discoveries Ltd. to accompany a financing.
This report is based on a review of publicly available data and a personal visit to the property on 23 August 2004.
The property comprises eighty-four mineral claim units within one contiguous block; property area is two thousand hectares. Registered owner of K.C.1 to K.C.4 mineral claims is J. Billingsley and registered owner of Kelly 1 to Kelly 4 mineral claims is Watershed Resources Ltd.

Aumega Discoveries Ltd has an option to acquire a one hundred per cent interest in the property by making cash payments of $10,000 and issuing 400,000 shares over a four-year period. The optionor retains a two per cent net smelter return royalty.
The property is centred near 54° 26' North latitude 128° 08' West longitude and is within NTS map-sheet 103I 08E and British Columbia map-sheet 103I 050.

The property is accessible from Terrace thirty kilometers westerly via British Columbia Highway 16 and Zymoetz River main logging road to the northern part of Kelly 1 and Kelly 2 mineral claims. Four-wheel drive roads provide access to the southern and central parts of the property.
Fuel, supplies and scheduled air, ground and rail transportation are available at Terrace.

Elevation at the property ranges between 220 metres and 1420 metres. Much of the property is covered in mature timber; parts of the property have been logged.

Permits are required to be obtained for any physical surface exploration and notice is required to be given prior to re-commencing underground work from the Chief Mine Engineer, British Columbia Ministry of Energy and Mines, Smithers, B.C.

Previous exploration within the area now covered by Kelly Creek Project property includes: prospecting, trenching, soil geochemical surveying, induced polarisation geophysical surveying core drilling in at least twenty-eight holes, driving of underground workings comprising three hundred and two metres, underground core drilling in at least twelve holes comprising 621.6 metres, rock and core sampling and geological evaluation. Not all results of past work are available.

Drill holes in Upper Kelly Creek prospect area contained up to 5.35 per cent copper and 95.3 grams per tonne silver over 4.6 metres in underground drill hole UK5 and 1.30 per cent copper and 28.8 grams per tonne silver over 34.5 metres core length with an estimated true width of 22.5 metres in underground drill hole UK10.

In 1981 Cathedral Minerals Ltd. estimated a resource at Upper Kelly Creek prospect comprising an indicated resource of 2.27 million tonnes containing 1.03 per cent copper and 18.5 grams per tonne silver and an inferred resource of similar tonnage and grade as the indicated resource; this estimate was performed prior to the introduction of current resource reporting standards.

No exploration has been performed by the present property owners within K.C. 1 to K.C.4 mineral claims or within Kelly 1 to Kelly 4 mineral claims.

The property is within the Intermontane Belt of the Canadian Cordillera near to the western contact with the Coast Range Plutonic belt.

The property is underlain by volcanics and volcaniclastics of Hazelton Group of lower Jurassic age and by granitic intrusives of possible Cretaceous to Tertiary age.

The Kelly Creek property is prospective for volcanic hosted red bed copper deposits associated with volcanics of Hazelton Group and for copper porphyry deposits associated with granitic intrusives. Upper Kelly Creek deposit has many similarities to volcanic red bed copper deposits.

Deposits of volcanic hosted red bed copper type include Calumet Mine in Michigan and Sustut deposit in British Columbia. At Calumet Mine, 72.4 million tonnes were produced containing 2.64 per cent copper; at Sustut copper deposit a resource of 8.24 million tonnes containing 1.62 per cent copper has been identified.

At Upper Kelly creek prospect, pyrite, chalcopyrite and bornite exist within brecciated and silicified felsic volcanic and volcanic breccia. Mineralisation exists within an easterly striking, southerly dipping body up to twenty seven metres thick; dip of the body is about thirty degrees southerly.
At East Side occurrence malachite and disseminated chalcopyrite and bornite exist in silicified tuff; a channel sample contained 0.70 per cent copper, 10.3 grams per tonne silver over 4.7 metres.

At Lower Kelly Creek and Chicken occurrences, chalcopyrite and bornite exist within granitic intrusive.

Fifteen occurrences in volcanics and volcaniclastic within the property are mineralised in part with chalcopyrite, bornite, malachite and native copper.

No verification or check sampling of previous exploration sampling results has been performed. Available documentation of previous exploration procedures appear consistent with good practise current in the industry at the time.

No results of any previous bulk sampling or metallurgical evaluation are available. No reserve or resource estimates to current standards have been published for deposits within the property.

Kelly Creek Project property is prospective for copper and silver mineralised deposits of volcanic red bed hosted type within volcanics of Hazelton Group and for copper deposits of porphyry copper type within granitic intrusives.

Kelly Creek project property is prospective for copper and silver mineralised deposits of the volcanic hosted red bed type within volcanics of Hazelton Group volcanics and for porphyry copper and precious metal deposits within granitic intrusives. Further exploration at Kelly Creek Project is warranted.

The following work is recommended:

Phase I

Compile previous exploration results. A search should be made for sample results for all surface and underground drill holes. This work is estimated to cost $7,000 and would require one month to complete.

Test area underlain by Hazelton Group volcanic rocks for copper and precious metal containing sulphide deposits utilizing helicopter airborne electromagnetic and magnetic geophysical surveying. This work is estimated to cost $45,000 and would require three weeks to complete.

Perform stream sediment geochemical sampling to test for copper and precious metal containing deposits within Hazelton Group volcanics and for porphyry copper and precious metal containing deposits within granitic intrusives. This work is estimated to cost $6,2 00 and would require four days to complete.

Previously drilled core from Kelly Creek Property area should be recovered and geologically logged; this work is estimated to cost $14,000 and would require 15 days to complete.

Total Phase I exploration is estimated to cost $72,200.

Phase II

Geologically evaluate selected airborne geophysical anomalies identified in Phase I work; this work is estimated to cost $9,000 and would require about one month to complete.

Drill test selected airborne geophysical anomalies identified in Phase I exploration. Assuming three airborne geophysical anomalies are identified in Phase I exploration as warranting further work, and each anomaly is tested with three holes each of eighty metres in length, this work is estimated to cost $97,000 and would require about six weeks to complete.

At Upper Kelly Creek deposit area:

Survey underground workings and collar locations of surface and underground drill holes; this work is estimated to cost $2,000 and would require about two days to complete.

Geologically evaluate, Upper Kelly Creek deposit area including underground workings, Lower Kelly Creek Occurrence area and East Side Occurrence area. This work is estimated to cost $12,000 and could require one month to complete.

Total Phase II exploration is estimated to cost $120,000.

Phase III

Drill test selected prospects from Phase II drilling; assuming two prospects are identified warranting further exploration, this work is estimated to cost $360,000 and could require two months to complete.

Test extension of mineralisation in underground drill holes UK1, UK2, UK5, UK6, UK7, UK9, UK10 & UK11. Access for underground drilling will require extension of underground workings. This work is estimated to cost $800,000 and could require three months to complete.

Total Phase III exploration is estimated to cost $1,160,000.

Technical Report Summary (PDF - 5.18 Kb)