Golder Associates Ltd. 1010 Lorne Street Sudbury, Ontario, Canada P3C 4R9 Telephone: (705) 524-6861 Fax: (705) 524-1984

July 23, 2007 05-1117-044/6000

OFFICES ACROSS NORTH AMERICA, SOUTH AMERICA, EUROPE, AFRICA, ASIA AND AUSTRALIA

Submitted to: Adanac Moly Corporation 2A 15782 Marine Drive

White Rock, British Columbia V4B 1E6

Attention : Michael MacLeod, P.Eng. Vice President, Project Development

Prepared by:

Paul Palmer, P.Geo., P.Eng. Effective Date: July 23, 2007

DISTRIBUTION: Stamp #100050189 2 Copies - Adanac Moly Corporation, White Rock, British Columbia 1 Copy - Golder Associates Ltd., Mississauga, Ontario 1 Copy - Golder Associates Ltd., Sudbury, Ontario

MINERAL RESOURCE ESTIMATE UPDATE

RUBY CREEK MOLYBDENUM PROJECT IN BRITISH COLUMBIA, CANADA

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TABLE OF CONTENTS

SECTION PAGE

1.0 SUMMARY.................................................................................................. 1 2.0 INTRODUCTION......................................................................................... 6 3.0 RELIANCE ON OTHER EXPERTS............................................................ 8 4.0 PROPERTY DESCRIPTION AND LOCATION .......................................... 9 5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE

AND PHYSIOGRAPHY............................................................................. 12 6.0 HISTORY .................................................................................................. 13 7.0 GEOLOGICAL SETTING.......................................................................... 15

7.1 Regional Scale ......................................................................................15 7.2 Property Scale .......................................................................................18

7.2.1 Lithology ....................................................................................18 7.2.2 Structure ....................................................................................20 7.2.3 Alteration....................................................................................21

8.0 DEPOSIT TYPE........................................................................................ 23 9.0 MINERALIZATION.................................................................................... 25 10.0 EXPLORATION......................................................................................... 27 11.0 DRILLING.................................................................................................. 31 12.0 SAMPLE METHOD AND APPROACH..................................................... 35 13.0 SAMPLE PREPARATION, ANALYSES AND SECURITY ....................... 37

13.1 Field Sample Preparation Procedures...................................................37 13.2 Laboratory Sample Preparation Procedures .........................................38 13.3 Analytical Procedures............................................................................39 13.4 Quality Assurance and Quality Control..................................................40

13.4.1 Procedures ................................................................................40 13.4.2 Results –2006 Samples.............................................................41

14.0 DATA VERIFICATION .............................................................................. 42 15.0 ADJACENT PROPERTIES....................................................................... 44 16.0 MINERAL PROCESSING AND METALLURGICAL TESTING................ 45 17.0 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES .......... 46

17.1 2007 Ruby Creek Mineral Resource Estimate Summary ......................46 17.2 The Database ........................................................................................47 17.3 The Geological Model............................................................................48 17.4 Wireframe Validation .............................................................................52 17.5 Data Preparation and Compositing .......................................................53 17.6 Declustering...........................................................................................54 17.7 Spatial Trend Analysis...........................................................................55

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TABLE OF CONTENTS (CONTINUED)

17.8 High-Grade Treatment...........................................................................55 17.9 Variogram Analysis................................................................................56

17.9.1 Variography Objectives and Approach ......................................56 17.9.2 Summary of Variography Parameters .......................................56

17.10 Update Block Model Parameters...........................................................57 17.11 Grade Interpolation................................................................................58

17.11.1 Grade Interpolation Methods and Objectives.................58 17.11.2 Ordinary Kriging Plan.....................................................59

17.12 Density Assignment...............................................................................60 17.13 Mineral Resource Classification ............................................................61 17.14 Mineral Resource Summary ..................................................................62

18.0 OTHER RELEVANT DATA AND INFORMATION ................................... 64 19.0 CONCLUSIONS AND RECOMMENDATIONS ........................................ 65 20.0 REFERENCES.......................................................................................... 67 21.0 SIGNATURE PAGE .................................................................................. 69 22.0 STATEMENT OF QUALIFICATIONS AND CONSENT OF AUTHOR..... 70

22.1 Statement of Qualifications....................................................................70 LIST OF TABLES Table 1-1 February 22, 2007 Mineral Resource Estimate, Ruby Creek Molybdenum

Project Table 4-1 List of Mineral Claims, Ruby Creek Molybdenum Project Table 6-1 January 2006 Mineral Resource Estimate, Ruby Creek Molybdenum Project Table 7-1 Lithological Units at the Ruby Creek Molybdenum Project Table 11-1 Drilling History of the Ruby Creek Deposit Table 11-2 Drill Holes in the 2006 Ruby Creek Datamine Database Table 17-1 Drill Hole Data in the January 2006 Database Table 17-2 2007 Ruby Creek Geometries Table 17-3 Primary and Secondary Lithological Units at the Ruby Creek Molybdenum

Project Table 17-4 High-Grade Thresholds for Mo% by Zone Table 17-5 Variography Parameters for Zones 6 and 7 Table 17-6 Block Model Dimensions for Ruby Creek Resource Model Table 17-7 Ruby Creek Deposit Kriging Plan Parameters Table 17-8 Rock Type Bulk Density Assigned to the Block Model Table 17-9 February 22, 2007 Mineral Resource Estimate, Ruby Creek Molybdenum

Project

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TABLE OF CONTENTS (CONTINUED)

LIST OF FIGURES Figure 4-1 Location Map, Ruby Creek Molybdenum Project Figure 4-2 Mineral Claims Map, Ruby Creek Molybdenum Project1 Figure 7-1 Regional Geology Map of the Atlin Area Figure 7-2 Property Geology Map, Ruby Creek Molybdenum Project (2004) Figure 10-1 Plan View of 2006 Drill Hole Collars Figure 11-1 Plan View of Drill Holes and Exploration Grid Figure 13-1 Adanac Field Sample Preparation Procedures Figure 17-1 Section View of 3D Mineralization Zones and Rock Types for Ruby Creek

Deposit Figure 17-2 Global Distribution of Raw Sample Lengths (Palmer, 2006) Figure 17-3 Plan View of Block Model Geometry LIST OF APPENDICES Appendix A 2007 Mineral Resource Estimate, Ruby Creek Molybdenum Project Letter

dated March 14, 2007 Appendix B Selection of Vertical Sections and Plan Drawings, Ruby Creek Molybdenum

Project

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1.0 SUMMARY

Adanac Moly Corporation (Adanac) retained Golder Associates Ltd. (Golder) to provide an updated independent Mineral Resource Estimate for the Ruby Creek Molybdenum Project (Ruby Creek) in northern British Columbia. The Mineral Resource Estimate has been completed in conformance with the CIM Estimation of Mineral Resources and Mineral Reserves Best Practice Guidelines referred to in Companion Policy 43-101CP to National Instrument NI 43-101, This report represents the second Ruby Creek Mineral Resource Estimate completed by Golder and the third reporting of the mineral resources in accordance with the CIM definitions referred to in NI 43-101 for Adanac. The February 22, 2007 Mineral Resource Estimate for Ruby Creek has shown a slight increase in tonnage compare to the 2006 Mineral Resource Estimate. The main changes in the updated resouce estimate is that higher confidence has been defined such that additional tonnages from the inferred and indicated categories have been upgraded to indicated and measured categories. Therefore a full independent Technical Report is not required as outlined in Section 5.2 of the NI 43-101 Standards of Disclosure for Mineral Projects. This report main objective is to support the February 22, 2007 Mineral Resource Estimate and summarize activities that has been completed during the 2006 field program.

Paul Palmer, P.Geo., P.Eng., an employee of Golder, served as the independent Qualified Person (QP) responsible for preparing the February 22, 2006 Mineral Resource Estimate. The February 22, 2007 Mineral Resource Estimate is based on new data from 16 drill holes (aggregate length of 3,921 m) completed during the 2006 field program and the historical drilling and underground sample data collected on the property from 1966 to 1980 and three field seasons completed by Adanac between 2004 and 2006. All drilling and underground sample data for Ruby Creek is stored as drill hole data in a Datamine® database (Ruby Creek Datamine Database) that was compiled by Golder based on ASCII and Excel files provided by Adanac. The Ruby Creek Datamine Database currently consists of 266 drill holes totalling 46,912 m that were used for the February 22, 2007 Ruby Creek Mineral Resource Estimate.

As part of the February 22, 2007 Mineral Resource Estimate for Ruby Creek, a review was completed on the 2006 drilling data. This included a review of the data collection procedures on site, which was completed on August 22, 2006 by Mr. Paul Palmer, and a review of the results from the sampling quality assurance and quality control (QA/QC) program for molybdenum and trace element assaying that is completed by Adanac. The QA/QC program completed by Adanac is the same program that has been developed since 2004 and includes storing permanent half core (sawed or split samples) on site. The review completed by Golder regarding the 2006 QA/QC program indicates that program employed by Adanac is under control and of industry standard. Independent drill samples were not collected by Golder during the 2006 site visit because

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molybdenite mineralization was observed in the 2006 drill core and independent drill samples were collected during the 2005 site visit by Golder.

The main focus of the 2006 drilling field program was an inclined drilling program (13 holes) in the central deposit pit area, with a focus on improving the confidence of the mineral resource estimate (move indicated to measured resources) and providing structural orientation data information on the sub-vertical and sub-horizontal molybdenum hosted veins.

The February 22, 2007 Mineral Resource Estimate for Ruby Creek was based on three dimensional (3D) geological models, mineralization models and block models generated with commercial mine planning software (Datamine and Vulcan) based on the Ruby Creek Datamine Database. Geology and mineralization 3D solids were used to apply constraints on the higher grade mineralization during grade interpolation and estimation of tonnages. Assays were composited into 6 m down-hole composites and honoured the mineralized zone boundaries.

The statistical analyses that were completed in the 2006 estimate were used during the 2007 estimate. The main difference in the statistical approach in the 2007 data was applying different variography models to the block model for resource estimation purposes. The variography models used in the February 22, 2007 Mineral Resource Estimate were based on the 2006 estimate and the information collected from a structural analysis of a selection of 2006 inclined drill holes.

Molybdenum (Mo%) grades were estimated with multiple passes of interpolation, with the first pass utilizing a relatively small search range to help honour local composite grades. The second and third passes utilized progressively longer search ranges. For all three passes, Ordinary Kriging (OK) was used to interpolate grades.

Classification of the resource estimate was completed based principally on data density and geological confidence criteria. Consideration was also given to the classification of the previous resource published in the Technical Report – Mineral Resource Estimate Ruby Creek Project (Blower, 2005) in order to achieve some continuity between the 2006 and 2007 resource estimate in terms of changes in proportions of resource categories with the additional drilling.

During the 2006 exploration program, eight drill holes (AD-357, AD 359, AD-361, AD-363, AD-364, AD-366 to AD-368) from the program were surveyed with an optical televiewer camera in order to determine dominant dip and dip directions of the mineralized veins. At the time of the mineral resource estimate, a review of this data was completed by the QP and three dominant vein orientation sets were identified and are as follows:

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• Set 1: 50-80° dip/170-195° dip direction;

• Set 2: 50-85° dip/300-310° dip direction; and

• Set 3: 5-15° dip/350-010° dip direction.

The structural data collected from the inclined holes were based on veins sizes ranging from <5 mm, 5-10 mm and >10 mm. Set 3, near horizontal veins, had the largest number of veins identified in the analysis, which is consistent with the current understanding of mineralization.

Based on the structural data analysis from the televiewer data, two mineral resource estimates were calculated for Ruby Creek in order to determine the impact of potential higher grade mineralization associated with cross-cutting horizontal and vertical veins. The first resource estimate (Model 1) is based on using the geostatistical analysis defined from the 2005 and 2006 mineral resource estimates, which used a variography orientation that was horizontal. The second resource estimate (Model 2) is based on using both horizontal and vertical variography orientations. In order to estimate the Model 2 mineral resource, a new mineralized domain (define as Zone 60) was created in the Phase 1 pit area, located predominantly in the central deposit area and includes the highest drilling density and where both vertical and horizontal veining have been observed in the drill core. In the Model 2, mineral resource calculation, Zone 60 was estimated using a vertical variography orientation and all mineralization zones outside of Zone 60 were estimated using a horizontal variography orientation.

A comparison of the tonnage and grade estimates was completed from each model and indicated that the combined measured and indicated tonnage for Model 1 was slightly higher (approximately 0.5% higher) when compared to Model 2 and the grades were the same. Therefore, Model 1 was used as the mineral resource for Ruby Creek. The Model 2 mineral resource estimates supports the current estimates and should be reviewed again if additional inclined drilling data is collected.

The February 22, 2007 Mineral Resource Estimate for Ruby Creek is tabulated by cut-off grades from 0.02 to 0.1 Mo% for measured, indicated and inferred mineral resource categories and is summarized in Table 1-1. The combined measured and indicated mineral resource estimate using a 0.04 Mo% cut-off is 212,907,000 t, 0.063 Mo% and 295,699,000 Mo lb. Comparing the February 22, 2007 Mineral Resource Estimate to the 2006 estimate indicates an increase of 6,532,000 t, 10,095,000 Mo lb and no change in grade. The changes in the February 22, 2007 Mineral Resource Estimate is attributed to the 2006 inclined drilling program (grade and tonnage) and re-interpretation of the 2006 mineralized geometries (tonnage). The majority of the 2007 drilling is in the central deposit area and has increased the measured tonnage resource in this area

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by upgrading material from the indicated resource. No significant grade increases occurred between the January 2006 and February 22, 2007 Mineral Resource Estimate.

The February 22, 2007 Mineral Resource Estimate has shown a decrease in both tonnage and grade in the inferred category compared to the January 2006 mineral estimate. Most of these changes are based on the reclassification of inferred tonnages to indicated tonnages and re-interpretation of the 2006 mineralized geometries (tonnage).

The conclusions and recommendations that have been identified from the February 22, 2007 Mineral Resource Estimate is as follows:

• The geology of the Ruby Creek Molybdenum Project is well understood.

• The inclined drilling did nominally intersect higher grade mineralization and therefore should be considered for future exploration programs.

• The drill hole database and all surfaces, geometries and models used in the 2007 mineral resource were converted to the NAD 83 UTM co-ordinate system. This conversion was based on a combination of drill holes surveyed in NAD 83 UTM and the moving of historical holes, model surfaces and geometries from NAD 27 UTM to NAD 83 UTM by adding 174N (Y), and subtracting 104E (X).

• The database was reviewed by Golder using statistical and geostatistical analyses and comparisons between field logs and the digital database This database was considered acceptable for mineral resource estimation.

• A global density of 2.57 g/cm3 applies to the overall mineralized envelope. To date, over 1,000 samples have been collected from the 2004 to 2006 drilling programs. Very little difference has been identified from the various lithological units. Ongoing sampling should be considered if new lithological samples have been identified, in areas where only pre-2004 drilling was available and if the sulphide content of the samples is higher than typically collected.

• A drill hole sample database should be created by Adanac that includes drill hole data, QA/QC sample results, metallurgical testing, specific gravity testing and environmental testing. Currently, this data is stored in many Excel spreadsheets and as the project goes forward needs to put in a system more robust and auditable.

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TABLE 1-1 FEBRUARY 22, 2007 MINERAL RESOURCE ESTIMATE

RUBY CREEK MOLYBDENUM PROJECT

Resource Category Cut-off (Mo%) Tonnage Mo% Mo lb

0.020 55,831,000 0.068 83,698,000

0.030 54,300,000 0.069 82,600,000

0.040 49,106,000 0.073 79,029,000

0.050 41,389,000 0.078 71,172,000

0.060 30,151,000 0.086 57,165,000

0.070 21,909,000 0.094 45,403,000

0.080 14,556,000 0.104 33,374,000

0.090 10,411,000 0.112 25,706,000

Measured

0.100 6,612,500 0.122 17,785,000

0.020 387,278,000 0.042 358,593,000

0.030 238,954,000 0.052 273,935,000

0.040 163,801,000 0.060 216,669,000

0.050 109,444,000 0.067 161,658,000

0.060 61,471,000 0.077 104,350,000

0.070 37,664,000 0.084 69,749,000

0.080 18,813,000 0.094 38,987,000

0.090 9,848,100 0.102 22,145,000

Indicated

0.100 4,286,900 0.113 10,680,000

0.020 443,108,000 0.045 442,290,000

0.030 293,254,000 0.055 356,535,000

0.040 212,907,000 0.063 295,699,000

0.050 150,834,000 0.070 232,831,000

0.060 91,621,000 0.080 161,513,000

0.070 59,573,000 0.088 115,151,000

0.080 33,369,000 0.098 72,360,000

0.090 20,259,000 0.107 47,851,000

Measured +

Indicated

0.100 10,899,000 0.118 28,464,000

0.020 135,737,000 0.032 95,759,000

0.030 48,456,000 0.045 48,072,000

0.040 24,973,000 0.054 29,730,000

0.050 11,631,000 0.064 16,411,000

0.060 5,194,300 0.077 8,817,500

0.070 2,626,200 0.089 5,152,900

0.080 1,239,700 0.103 2,815,000

0.090 821,310 0.113 2,046,000

Inferred

0.100 493,790 0.125 1,360,800

Cut-off Mo% grades were classified as greater than or equal to

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2.0 INTRODUCTION

Adanac retained Golder to provide an independent mineral resource estimate for the Ruby Creek Molybdenum Project (Ruby Creek) in northern British Columbia. The work entailed estimating mineral resources in conformance with the CIM Mineral Resource and Mineral Reserve definitions referred to in National Instrument NI 43-101, Standards of Disclosure for Mineral Projects. This report represents the third reporting of the Ruby Creek mineral resources in accordance with the CIM definitions referred to in NI 43-101. Paul Palmer, P.Geo., P.Eng., an employee of Golder, served as the independent QP responsible for preparing the mineral resource estimate and report. Sia Khosrowshahi of Golder Associates Pty. provided geological statistical and mineral resource evaluation support in the preparation of this document under the direction of the QP. Kevin Palmer, P.Geo., and Richard Gaze of Golder have provided a peer review of this report.

Information and data for the mineral resource estimate were obtained from Adanac, and data from the two Technical Reports completed by Golder (Palmer, 2006) and AMEC Americas Limited (Blower, 2005).

The February 22, 2007 Mineral Resource Estimate for Ruby Creek has not significantly changed compared to the 2006 mineral resource estimate; therefore, an independent Technical Report was not required as outlined in Section 5.2 of the NI 43-101 Standards of Disclosure for Mineral Projects. This report supports the February 22, 2007 Mineral Resource Estimate that has been disclosed to the public by Adanac. This report follows the format of a Technical Report but primarily focuses on the changes from previous reports. Sections of this report that are repetitive of previous report sections will refer the reader to the previous Technical Reports.

A site visit to the Ruby Creek Project was conducted by Paul Palmer on August 22, 2006. The objective of the site visit was to review and observe the data collection procedures, storage, QA/QC protocols and observe deposit mineralization.

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LIST OF ABBREVIATIONS

feet ft percentage % grams g tonnes (1,000 kg) T grams per tonne g/t tonnes per day t/d kilometres km ton (2,000 lb) ton metres m percentage % metres above sea level masl kilograms kg millimetres mm Universal Trans Mercator UTM diameter dia Digital Terrain Model DTM cubic centimetres cm3 Ordinary Kriging OK pounds lb

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3.0 RELIANCE ON OTHER EXPERTS

The 2007 Mineral Resource Estimate relied on work completed in the reports titled Technical Report – Mineral Resource Estimate Ruby Creek Project (Blower, 2005 and Palmer, 2006). This report also relied on a report prepared by Sinclair Consultants Limited (Sinclair, 2005) on matters pertaining to QA/QC during the 2004 drill program and a review of the data collected prior to 2004.

Descriptions of regional and deposit geology, history of property and sampling procedures on site have been provided by information and reports prepared by Robert Pinsent, P.Geo.

Golder did not complete as part of this report a legal survey of the property, identify terms of royalties, back-in rights, payments or other agreements and if there were encumbrances to the Ruby Creek Property. All property information was provided by Adanac. Golder did not review if permitting of the property was obtained prior to work completed on the property.

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4.0 PROPERTY DESCRIPTION AND LOCATION

The Ruby Creek Molybdenum Project is located in the Atlin Mining Division at the head of Ruby Creek at Lat. 59° 42.5’ N, Long. 133° 24’ W; Elevation 1500 m according to National Topographic Map Sheet 104N/11 (1:50 000). The deposit is approximately 24 km northeast of Atlin in northern British Columbia, covering an area of approximately 5,450 hectares (Figure 4-1) and is accessible via a 40 km road from Atlin, of which the first 19 km to the bridge at Surprise Lake which is fully maintained. Thereafter, the remaining 21 km of road is a mine-access road.

The Ruby Creek Molybdenum Project consists of a single, irregularly shaped block of 13 tenures covering the upper southwest part of the Ruby Creek valley and much of the adjacent Boulder Creek valley. The claims are 100% owned by Adanac, and share a common expiry date of 2015. The claims and their boundaries are listed in Table 4-1 with their locations shown on Figure 4-2 which is information that was provided by Adanac.

The mineralization and published mineral resource estimates for The Ruby Creek Molybdenum Project are located in the north area of the Adanac claims. The only historical mining development (1973) completely on the project site included underground drifting (589 m), cross-cuts (246 m) and raises (6) located in the central area of the deposit. The underground excavations are currently not accessible.

No information regarding the terms of royalties, back-in right, payments or other agreements and encumbrances have been included in this report.

No information regarding environmental liabilities or knowledge of permitting for the Ruby Creek Molybdenum Project have been included in this report.

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FIGURE 4-1: LOCATION MAP, RUBY CREEK MOLYBDENUM PROJECT

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TABLE 4-1: LIST OF MINERAL CLAIMS, RUBY CREEK MOLYBDENUM PROJECT

Tenure Number Area (Hectares) Map Number Expiry 503346 81.66 - 2015 510307 326.5 104N064 2015 510308 620.5 104N063 2015 510309 391.9 104N063 2015 510310 587.6 104N063 2015 510311 241 104N074 2015 510315 440.6 104N063 2015 510317 98 104N063 2015 510319 1,405.5 104N063 2015 510320 458.2 104N063 2015 510382 376.1 104N074 2015 519616 408.23 - 2015 519782 16.33 - 2015 Total 5,452.12 - -

FIGURE 4-2: MINERAL CLAIMS MAP, RUBY CREEK MOLYBDENUM PROJECT1

1Provided by Adanac Moly Corporation

Approximate Ruby Creek

Property Boundary

N

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5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY

The Ruby Creek property is located within the Northern Alplands Biotic Area (alpine terrain) at an approximate elevation of 1,500 m. The headwaters of Ruby Creek are located within the property boundaries and flow into the Surprise Lake as illustrated on Figure 4-1. The deposit underlies a flat, relatively un-vegetated cirque near the head of the valley. The walls of the cirque are moderately steep, but the floor is glacially scoured and flat. The climate is temperate. Summers are mild, and may be either wet or dry. Winters tend to be cold and the area receives a moderate amount of snowfall that accumulates between October and May.

Other than road access, there is no significant infrastructure on the property. A wooden core processing building and drill core rack facility are the only structures on the property. All power on the property during the 2006 exploration program was provided by generators. The town of Atlin, 24 km southwest of the property, is a source for fuel, groceries, accommodation and charter aircraft services. Atlin is accessible via a 190 km all-weather road located south of Whitehorse, Yukon. The remaining road from Jakes Corners to Atlin is a well maintained gravel road. Whitehorse is a major supply centre for the region, with daily commercial flights to Vancouver and other cities. Atlin is also a three-hour drive from tidewater at Skagway, Alaska.

In depth details of the local climate are provided in the environmental baseline report by Klohn Crippen, “Ruby Creek Molybdenum Project Environmental Baseline”, dated December, 2004 (Thorpe, 2004).

Details of planned mining operations, availability and sources of power, water, mining personnel, potential tailings storage areas and potential processing facilities are provided in the report by Golder Associates Ltd. “Ruby Creek Molybdenum Project Mining Feasibility Study”, dated March 2006 (Rodgers and Buck).

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6.0 HISTORY

A detailed history of the Ruby Creek deposit is provided in the Technical Report – Mineral Resource Estimate Ruby Creek Molybdenum Project (Palmer, 2006), which were based on reports provided by Pinsent (2005) and Blower (2005).

The current database for the Ruby Creek deposit is composed of 266 drill holes with a total of 46,912 m of drilling information. Between the years of 2004 and 2006, Adanac has drilled a total of 73 of the 266 drill holes.

Independent Mineral Resource Estimates for the Ruby Creek deposit have been completed in 2005, 2006 and 2007. Outlined in Table 6-1 is the previous NI-43-101 2006 Mineral Resource Estimate for Ruby Creek based on the 2006 Technical Report (Palmer, 2006).

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TABLE 6-1 JANUARY 2006 MINERAL RESOURCE ESTIMATE

RUBY CREEK MOLYBDENUM PROJECT

Resource Category Cut-off (Mo%) Tonnage Mo% Mo lb

0.020 40,636,000 0.077 68,982,000 0.030 40,386,000 0.077 68,557,000

0.040 38,942,000 0.079 67,822,000 0.050 35,834,000 0.081 63,990,000 0.060 28,836,000 0.088 55,942,000 0.070 22,593,000 0.094 46,820,000 0.080 15,225,000 0.104 34,907,000 0.090 10,601,000 0.112 26,175,000

Measured

0.100 6,908,000 0.121 18,427,000

0.020 432,936,000 0.041 391,325,000 0.030 261,618,000 0.051 294,149,000

0.040 167,433,000 0.059 217,782,000 0.050 113,435,000 0.066 165,052,000 0.060 63,101,000 0.076 105,725,000 0.070 37,572,000 0.083 68,751,000 0.080 17,543,000 0.094 36,355,000 0.090 8,808,000 0.103 20,001,000

Indicated

0.100 4,151,000 0.113 10,340,000

0.020 473,572,000 0.044 460,307,000 0.030 302,004,000 0.054 362,706,000

0.040 206,375,000 0.063 285,604,000 0.050 149,269,000 0.070 229,042,000 0.060 91,937,000 0.080 161,667,000 0.070 60,165,000 0.087 115,571,000 0.080 32,768,000 0.099 71,262,000 0.090 19,409,000 0.108 46,176,000

Measured +

Indicated

0.100 11,059,000 0.118 28,767,000

0.020 151,326,000 0.034 113,429,000 0.030 61,837,000 0.048 65,437,000

0.040 33,067,000 0.060 43,740,000 0.050 23,225,000 0.067 34,305,000 0.060 13,375,000 0.076 22,409,000 0.070 6,490,000 0.088 12,591,000 0.080 3,166,000 0.102 7,120,000 0.090 1,915,000 0.113 4,771,00

Inferred

0.100 1,143,000 0.124 3,124,000

Cut-off Mo% grades were classified as greater than or equal to

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7.0 GEOLOGICAL SETTING

The regional and local geological setting descriptions of the Ruby Creek deposit are provided in reports by Pinsent (2005), Blower (2005) and Palmer (2006). In Golder’s opinion, geology of the Ruby Creek deposit and the controls on mineralization are sufficiently well understood for resource estimation.

Additional analysis has been completed during the 2006 drilling program in order to better understand the sub-vertical and sub-horizontal vein orientations and molybdenum mineralization using in-hole optical televiewer cameras. The 2006 drilling results indicated that high grade mineralization did occur along both sub-vertical and sub-horizontal veins. These vein orientation results were also applied to the mineral resource estimate process. However, more inclined drilling data is required to better understand the relationship between sub-vertical and sub-horizontal vein orientations and higher grade molybdenum mineralization.

7.1 Regional Scale

The Ruby Creek deposit is a disrupted, dome-shaped occurrence formed late in the development of a localized plutonic complex. It is associated with granitic to quartz monzonitic rocks of the Surprise Lake Batholith, east of Atlin.

The geology of the Atlin area was mapped by Aitken (1959), and the regional setting of the deposit was discussed by Christopher and Pinsent (1982). Described simply, the Atlin area illustrated on Figure 7-1 is underlain by deformed and weakly metamorphosed ophiolitic rocks of the Pennsylvanian and/or Permian-aged Cache Creek Group (Monger, 1975). These rocks, which include serpentinites and basalts as well as limestones, cherts and shales, are thought to be the source of much of the placer gold found in the Atlin area. This stratigraphy is cut by two younger batholiths: north of Pine Creek, they are cut by a Jurassic-age granodiorite to diorite intrusion known as the Fourth of July Batholith and, north and south of Surprise Lake, they are cut by a Cretaceous-age granitic to quartz monzonitic intrusion known as the Surprise Lake Batholith.

The rocks are locally strongly faulted and the Ruby Creek deposit is located near the intersection of two major, pre- to post-mineral fault systems. The deposit location is partially offset by the Adera Fault system, which trends from southwest to northeast down Ruby Creek and defines much of the southern boundary of the Fourth of July Batholith. The deposit is also controlled by the Boulder Creek Fault system. This runs due north up Boulder Creek and cuts across the head of the Ruby Creek drainage. The Boulder Creek Fault appears to have helped localize

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emplacement of the deposit, which is intimately associated with late-stage porphyritic and aplitic plutonic rocks intruded into a marginal phase of the Surprise Lake Batholith.

Ruby Mountain, immediately to the south of the deposit (Figure 7-1), is underlain by a Late Tertiary to Quaternary volcano that erupted and filled the lower part of the Ruby Creek drainage with columnar basalt and volcanoclastic debris. The volcanic rocks unconformably overlie placer gold-bearing gravels. The origin of the gold is uncertain; however, most of it probably comes from quartz-carbonate veins hosted by shears that cut Cache Creek Group strata.

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FIGURE 7-1: REGIONAL GEOLOGY MAP OF THE ATLIN AREA

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7.2 Property Scale

The Ruby Creek deposit underlies the valley floor near the head of Ruby Creek. It is largely buried and has very little surface expression. There is little outcrop in the lower part of the valley and molybdenite is only rarely found in float and/or in veins in outcrop in the bed of the creek. The geology underlying the valley floor is largely derived from drill data, as illustrated on Figures 7-2 and sample vertical sections in Appendix B.

The deposit area is variously described by Sutherland Brown (1970), Janes (1971), White et al. (1976), Tennant (1979), Pinsent (1980), Christopher and Pinsent (1982) and Pinsent and Christopher (1995), among others. For consistency, the Surprise Lake granitic to quartz monzonitic rocks are described using the terminology used by Placer in 1979/80 (Tennant, 1979; Pinsent, 1980; and Pinsent and Christopher, 1995). A detailed description of the mineralization is provided in Section 9.0.

7.2.1 Lithology

The Ruby Creek area is underlain by two separate pulses of plutonic rock. The first pulse, which includes the contact phase between the two batholiths, consists of a highly variably textured unit that grades from Coarse-grained Quartz Monzonite (CGQM) south of the Adera Fault, through a number of texturally transitional phases including Transitional and/or Hybrid Coarse-grained Quartz Monzonite (CGQM-T; CGQM-H) and Crowded Quartz Feldspar Porphyry (CQFP) to Sparse Quartz Feldspar Porphyry (SQFP) upward and outward from the deposit. The latter is well exposed north of the Adera Fault, near the diorite contact.

The CGQM is weakly to moderately deformed, and consists of pink to grey equigranular, coarse-grained (0.5 to 3.0 cm) quartz monzonite consisting of equal amounts of orthoclase, plagioclase and grey quartz (Christopher and Pinsent, 1982). The feldspar is commonly seriate and, locally, includes a small amount of fine-grained (2 to 4 mm) matrix. CGQM grades to SQFP with increase in matrix content, and increased isolation of constituent phenocrystic crystals, particularly orthoclase and quartz.

The first phase also includes a distinctive Mafic Quartz Monzonite Porphyry (MQMP) unit that is present east of the deposit (Figure 7-2). This distinctive grey rock type has a seriate (1 to 4 mm) locally porphyritic texture. It is composed largely of chalky white plagioclase, disseminated biotite and phenocrysts of ragged plagioclase and lesser quartz. These rocks were fractured and deformed prior to emplacement of the second pulse of magma.

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There are three main mappable phases to the second pulse (Figure 7-2). They include Crowded Quartz Monzonite Porphyry (CQMP); Sparse Quartz Monzonite Porphyry (SQMP) and Fine-Grained Quartz Monzonite (FGQM).

The CQMP has an average of 50% (2 to 6 mm) subhedral to euhedral plagioclase, orthoclase, quartz and biotite phenocrysts in an aphanitic matrix. The SQMP variety is similar, but has fewer (10% to 30%) phenocrysts. The SQMP is fresher and generally less deformed than the surrounding rocks and has a much finer, more chilled matrix than the sparse quartz feldspar porphyry described above. The second phase porphyries cut out the older rock units and are exposed locally in the floor of the valley. They are also found in the subsurface, under the valley floor, upstream where the CGQM and its variants are intruded by a buried cupola of SQMP. Its shape has strongly influenced the locus of mineralization, as shown by Placer’s 0.06% and 0.1% Mo assay contours at 1,448 m elevation. Mineralization surrounds the buried cupola and, to a lesser extent, covers it (Figure 7-3).

The FGQM is a variably textured aplite that intrudes the CGQM (and also its variants) and the MQMP, above and around the sparse and crowded porphyry intrusions. This rock type is not exposed on surface, but it is well documented as forming a series of 0.05 to 10 m thick, approximately flat-lying, structurally-controlled sills in the higher-grade (northeastern) portion of the deposit (Figure 7-2). The sills are well exposed in Kerr Addison’s cross-cut, where some of the rock immediately north of Ruby Creek can only be described as plutonic breccia. FGQM dykes are found elsewhere around the buried sparse-porphyry cupola; however, they are generally less frequent and smaller, and occur as narrow dykelets.

In addition to these rock types, recent drilling at the southwest end of the deposit has located a Megacrystic Feldspar Porphyry (MFP) unit in the subsurface. This is not well constrained; however, it appears to be a relatively young phase of the quartz monzonite intrusion. It consists of rare to abundant large (>10 mm) euhedral orthoclase phenocrysts in a chilled matrix. Another notable feature throughout the deposit is the presence of coarse-grained quartz-feldspar pegmatite. This is not abundant, but covers a wide area as small dykes and structurally controlled sills.

Table 7-1 summarizes the lithology text codes applied to the 2004 to 2006 campaigns for mapping and drill hole core logging. Where possible, the same codes were applied to the older (pre- 2004) drill hole data.

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TABLE 7-1: LITHOLOGICAL UNITS AT THE RUBY CREEK MOLYBDENUM PROJECT

Text Code Description CGQM Coarse Grained Quartz Monzonite

CGQM-T ; CGQM-H CGQM – Transition and/or Hybrid Variety CQFP Crowded Quartz Feldspar Porphyry SQFP Sparse Quartz Feldspar Porphyry

MQMP Mafic Quartz Monzonite Porphyry SQMP Sparse Quartz Monzonite Porphyry CQMP Crowded Quartz Monzonite Porphyry FGQM Fine-Grained Quartz Monzonite MFP Mafic Feldspar Porphyry BSLT Basalt

7.2.2 Structure

Large-scale fault structures and their splays have provided conduits for mineralizing fluids and have associated localized mineralization. The deposit is situated at the intersection of the Adera and Boundary Creek Faults. The Adera Fault is particularly important because it offsets the northern portion of the deposit. It is a composite structure that dips steeply to the northwest, is normal in character and appears to have down-dropped (to the north) the northwestern part of what was originally a dome, or ring-shaped deposit formed above and around a SQMP intrusion. Mineralization has been found in the coarse-grained and related rocks northwest of the southernmost strand of the Adera Fault. However, it has not been found in (probably similarly-aged) SQFP and related rocks further north (Figure 7-2). These rocks, which are well exposed in the creek canyon below Molly Lake, contain abundant barren quartz veins and disseminated pyrite. They are gossanous, but barren.

In addition, during the 2006 drilling program, 8 drill holes (AD-357, AD 359, AD-361, AD-363, AD-364, AD-366 to AD-368) from the inclined drilling program were surveyed with an optical televiewer camera to determine dominant dip and dip directions of the mineralized veins. This work was completed by the Golder Burnaby office as a separate project from the mineral resource estimate. At the time of the mineral resource estimate, a review of this data collected by Golder was reviewed by the QP and three dominant vein orientation sets were identified and are as follows:

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• Set 1: 50-80° dip/170-195° dip direction;

• Set 2: 50-85° dip/300-310° dip direction; and

• Set 3: 5-15° dip/350-010° dip direction.

The structural data collected from the inclined holes were based on veins sizes ranging from <5 mm, 5-10 mm and >10 mm. Set 3, near horizontal veins, had the largest number of veins identified in the analysis, which is consistent with the current understanding of mineralization. Sub-vertical mineralization veins (Sets 1 and 2) were identified during the structural analysis, but previously of unknown orientation.

It is likely that Set 2 could be a subset of the Adera Fault since it is estimated as dipping steeply to the northwest.

7.2.3 Alteration

The rocks at Ruby Creek are, for the most part, fresh and much of the alteration that is observed is post-mineralization (secondary) and is associated with fluids that circulated during post-mineralization faulting. The amount of primary alteration is small and occurs as sill-like zones of intense silicification intermixed with bodies of aplite in the higher-grade, northeastern part of the deposit, and as intermittent feldspar envelopes and flooding around individual mineralized quartz veins throughout the deposit. In one locality, the silicification can be shown to pre-date both intrusion of aplite and emplacement of mineralized quartz veins.

Fractured rocks near post-mineral faults, such as the Adera, have commonly undergone late hydrothermal alteration. They are either weakly or strongly altered to a mixture of sericite, carbonate, clay and chlorite (without addition of secondary quartz). The altered rocks become soft and friable and early (1969/72) core recoveries were lower in these areas. Major faults commonly include breccias cemented by grey gouge of similar composition, with or without smeared molybdenite. Some of the altered rocks contain fluorite veins. Work by Placer in 1980 shows that most of the light-coloured clay is predominantly montmorillonite; however, the grey clay in the main Adera Fault zone consists largely of kaolinite.

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FIGURE 7-2: PROPERTY GEOLOGY MAP, RUBY CREEK MOLYBDENUM PROJECT (2004)

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8.0 DEPOSIT TYPE

The Ruby Creek deposit type section of the report is based on reports by Sinclair (1995) and Blower (2005).

Ruby Creek can be classified as a low fluorine porphyry molybdenum deposit (Sinclair, 1995). These deposits are characterised by stock works of molybdenite-bearing quartz veinlets and fractures in intermediate to felsic intrusive rocks and associated country rocks. They are typically low grade, but large and amenable to bulk mining methods.

Porphyry molybdenum deposits vary in shape from an inverted cup, to roughly cylindrical, to highly irregular. They are typically hundreds of metres across and range from tens to hundreds of metres in vertical extent. Mineralization is predominantly structurally controlled, consisting mainly of stock works of crosscutting fractures and quartz veinlets, with veins, vein sets and breccias. Molybdenite is the principal ore mineral; chalcopyrite, scheelite, and galena may be present but are generally subordinate (Sinclair, 1995).

These deposits are thought to originate from large volumes of magmatic, highly saline aqueous fluids under pressure. Multiple stages of brecciation related to explosive fluid pressure release from the upper parts of small intrusions result in deposition of ore and gangue minerals in cross-cutting fractures, veinlets and breccias in the outer carapace of the intrusions and in associated country rocks. Incursion of meteoric water during waning stages of the magmatic-hydrothermal system may result in late alteration of the host rocks, but does not play a significant role in the ore-forming process (Sinclair, 1995).

The typical size and grade of these deposits are 100 Mt at 0.1 to 0.15 Mo%. Some examples of these deposits are provided below, including tonnages and grades:

• Endako (B.C.): 336 Mt at 0.087% Mo

• Boss Mountain (B.C.): 63 Mt. at 0.074% Mo

• Kitsault (B.C.): 108 Mt at 0.115% Mo

• Carmi (B.C.): 34 Mt at 0.091% Mo

• Red Bird (B.C.): 34 Mt at 0.108% Mo

• Storie Moly (B.C.): 101 Mt at 0.078% Mo

• Trout Lake (B.C.): 50 Mt at 0.138% Mo

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• Glacier Gulch (B.C.): 125 Mt at 0.151% Mo

• Red Mountain (Yukon): 187 Mt at 0.100% Mo

• Quartz Hill (Alaska): 793 Mt at 0.091% Mo

• Thompson Creek (Idaho): 181 Mt at 0.110% Mo

• Compaccha (Peru): 100 Mt at 0.072% Mo

• East Kounrad (Russia): 30 Mt at 0.150% Mo

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9.0 MINERALIZATION

The mineralization description for the Ruby Creek deposit is based on a report by Pinsent (2005).

The Ruby Creek deposit consists of a stock work of veins of molybdenite and quartz-molybdenite found in all the principal rock types.

The approximate Ruby Creek deposit mineralization zone dimensions are 1500 m strike, widths 200 to 800 m wide (typical 600 m) and depths to 300 m (typical 180 m depth) excluding the overburden (4 to 13 m thick).

However, mineralization is best developed in the early stage plutonic rocks, MQMP and CGQM, which overlies and surrounds the buried SQMP stock under the Ruby Creek valley. The veins are most commonly without other metallic phases, although pyrite is found locally and chalcopyrite has been observed. The veins locally contain traces of scheelite, orthoclase, fluorite, biotite, sericite and carbonate.

Mineralization post-dates emplacement of the FGQM in the higher-grade zone located on the northeast side of the deposit. In this area, there appears to be a crude positive correlation between the presence of dykes and sills and the amount of mineralization observed. However, the same relationship does not hold on top of the cupola or in the southwestern side of the deposit. The deposit consists of a mineralized blanket that covers the SQMP stock and dips off in all directions.

The mineralization commonly consists of sulphide veins, as coatings on quartz-free fractures and as coarse and fine rosettes and blebs in both smoky and less clear quartz. It also occurs as streaks and smears in deformed rock and may, locally, be enriched in fault zones. In the higher-grade zone explored by Kerr Addison, much of the mineralization is in horizontal to sub-horizontal veins and fractures from 1 mm to 5 mm wide that are interspersed with veins that are considerably wider, up to 20 mm wide. The near-horizontal vein set is commonly cut by narrow 1 mm to 3 mm quartz veins that are oriented at a high angle to the (vertical) core axis. Both vein sets are mineralized and blebs of molybdenite commonly occur at the intersection of cross-cutting veinlets.

The near-horizontal vein set is locally extremely well mineralized. Veins exposed through underground development in the 1970s were reported to have shown that coarse-rosettes of

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molybdenite up to 30 mm in diameter formed in the plane of the vein, and that the spacing between the rosettes is variable, causing a pronounced nugget effect in drilling.

The crowded and sparse porphyries underling the higher-grade zone are cut by narrow (1 mm to 3 mm) mineralized quartz veins and fractures that also occur at both high and low angles to the (vertical) core axis. These veins and fractures commonly contain fine-grained to powdery molybdenite. There are fewer high-grade rosettes formed at depth.

As outlined in Section 7.2.2, optical televiewer surveys were completed in eight inclined boreholes form the 2006 drilling program in order to determine the dominant orientation of veins in the central portion of the deposit (also called the “payback” area) . The following three dominant sets have been identified from the survey:

• Set 1: 50-80° dip/170-195° dip direction;

• Set 2: 50-85° dip/300-310° dip direction; and

• Set 3: 5-15° dip/350-010° dip direction.

The dominant vein set identified from the survey is the horizontal set followed by two sub-vertical sets, Set 1 dipping south and Set 2 dipping northwest. It was identified by the Adanac geology staff that zones that were dominated by both horizontal and vertical veins sets in the 2006 drilling program showed an increased molybdenite mineralization. Therefore, the drilling of inclined boreholes in areas where both horizontal and vertical veining occurs increases the chance of sampling these zones. Based on the orientation of sub-vertical sets any future planned inclined boreholes should be drilled perpendicular to dip direction of these sets (azimuth directions north and southeast).

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10.0 EXPLORATION

Past exploration campaigns have been described in the previous Technical Reports by Blower (2005) and Palmer (2006). The following sections focus on the exploration programs completed by Adanac from 2004 to 2006.

Adanac 2004

Adanac Gold Corporation (Adanac Molybdenum Corporation) conducted a major exploration drilling campaign in 2004. The company drilled 38 holes for an aggregate depth of 9,087 m, in and around a previously established deposit and submitted 2,830 samples for molybdenum assaying. Additionally, 256 samples were collected for specific gravity testing by ALS Chemex Laboratories (ALS Chemex) in Vancouver, BC during the 2004 drilling program.

Ten holes were twinned in 2004 (5 twinned with Kerr Addison and 5 with Placer Development). These holes were designed to twin drill holes from earlier campaigns to validate historic drilling. The remaining holes were located to infill past campaigns to improve Adanac’s understanding of the overall shape of the deposit. The results were reviewed, validated and mineral resources were first reported in the April 2005 Technical Report (Blower, 2005).

Adanac 2005

Adanac Moly Corporation expanded on their 2004 campaign during 2005. The company drilled 19 holes for an aggregate depth of 4,984 m in and around the previously established deposit as well as on the deposit fringes. Five of the holes were geotechnical holes designed to gather the necessary parameters for pit slope stability assessment. The remaining 12 holes were located to infill past campaigns and on the fringes of the deposit to improve Adanac’s understanding of the overall shape, depth and extremities of the deposit.

Drill core sampling for the 2005 drilling program was based on the 2004 QA/QC program developed by Adanac. A total of 1,559 drill core samples were submitted to ACME Analytical Laboratories (ACME) in Vancouver, BC for analysis. The 7 holes internal to the established deposit, AD-337 to AD-343, were submitted for molybdenum analysis. The 3 short distal exploration holes, AD-344 to AD-346, were submitted for molybdenum as a trace element. The remaining drill holes (including geotechnical holes), AD-347 to AD-355, were also analyzed for molybdenum as a trace element. Additionally, 60 samples from seven drill holes (AD-337 to AD-343) were submitted for assay checks to ALS Chemex as part of the quality control program.

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A total of 615 samples were also collected for specific gravity testing and were submitted to ALS Chemex. The samples selected for specific gravity testing included 332 samples from 19 drill holes in the 2005 program and 283 samples from 30 holes in the 2004 drilling program. The results from the specific gravity testing showed similar results to the testing results in the Technical Report – Mineral Resource Estimate Ruby Creek Project (Blower, 2005). Details of the specific gravity testing are summarized in Section 17-13.

All 2005 drill hole collars were surveyed at the end of the drilling program by Underhill Geomatics Ltd. and were provided by Adanac using the NAD 27 UTM co-ordinate system which was also used in the 2004 drilling program. The same NAD 27 UTM co-ordinate system was also used in the historical drilling programs and was used in the 2004 and 2005 drilling programs for consistency. All 5 geotechnical drill holes were inclined dipping and were surveyed by Golder using an optical televiewer system. The optical televiewer system is able to determine dip and azimuth direction as well as video record in-hole borehole wall information. Where possible, the drill holes’ steel collar casings were left behind in the drill holes.

Adanac 2006

Adanac Moly Corporation continued a drill program during 2006. The company drilled 16 holes for an aggregate depth of 3,921 m in and around the previously established deposit (central deposit area) as well as the south and southwest edges of the deposit as illustrated on Figure 10-1. Three of the holes were located on the fringes to improve Adanac’s understanding of the overall shape, depth and extremities of the deposit. The remaining 13 holes were located to infill past campaigns and drilled at approximately -50° dip and 270° Azimuth.

Drill core sampling for the 2006 drilling program was based on the 2004 and 2005 QA/QC program developed by Adanac. A total of 1,238 drill core samples were submitted to ACME in Vancouver, BC for analysis, including 295 samples from drill holes AD-356 to AD-368, which were submitted for molybdenum oxide analysis. For quality control purposes, samples from drill holes AD-369 to AD-371 were also analyzed for molybdenum as a trace element and analysed for 40 other elements. Additionally, 186 samples from 13 drill holes (AD-356 to AD-368) were submitted to G&T Metallurgical Services for metallurgical testing. A total of 176 samples were submitted to ALS Chemex for specific gravity testing from the 2006 drilling program. One sample was selected approximately every 50 linear ft.

All 2006 drill hole collars were surveyed at the end of the drilling program by Underhill Geomatics Ltd. and provided by Adanac using the NAD 83 UTM co-ordinate system as well as in

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the NAD 27 UTM co-ordinate system. The NAD 27 UTM co-ordinate system was also used in the historical drilling programs and in the 2004 and 2005 drilling programs for consistency. The survey consulting company also provided 10 historical drill hole locations re-surveyed in the NAD 83 UTM co-ordinate system.

A decision by Adanac to use the NAD 83 UTM co-ordinate system for future mine site construction resulted in the conversion of the entire database to the NAD 83 UTM co-ordinate system. This conversion was based on a combination of drill holes surveyed in NAD 83 UTM and translating the remaining drill hole locations from NAD 27 UTM to NAD 83 UTM by adding 174N (Y), and subtracting 104E (X).

The 13 infill drill holes were inclined dipping and 8 of these were surveyed by the Golder Burnaby office using an optical televiewer camera system. The location of the 2006 drill holes is illustrated on Figure 10-1. Where possible, the drill holes’ steel collar casings were left behind in the drill holes.

Excel spreadsheets of the geological and assaying data for the 2006 drilling program were reviewed by Golder and included in the Ruby Creek Datamine Database. The QA/QC program was reviewed during the site visit by the QP and was consistent with the previous site visit and, in Golder’s opinion, was sufficient to include in the February 22, 2007 Mineral Resource Estimate.

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FIGURE 10-1: PLAN VIEW OF 2006 DRILL HOLE COLLARS

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11.0 DRILLING

The Ruby Creek deposit has undergone several drilling campaigns and is summarized in the previous Technical Reports by Palmer (2006), Blower (2005) and Pinsent (2005).

Summarized in Table 11-1 is the history of the drilling programs from 1966 to 2006. The holes were typically diamond drill holes except for a small number of early rotary drill holes.

TABLE 11-1: DRILLING HISTORY OF THE RUBY CREEK DEPOSIT

Company Years Drill holes (m)

Adanac Mining and Exploration, & John’s Manville 1966 to 1970 80 12,775

Kerr Addison Mines 1970 to 1972 47 5,626

Climax Molybdenum 1973 9 2,672

Placer Development 1979 to 1980 76 10,886

Adanac Gold (Adanac Moly Corp.) 2004 381 9,0871

Adanac Moly Corp. 2005 192 4,982

Adanac Moly Corp. 2006 16 3,921

Total - 285 49,950

Notes: 1 Includes 2 re-drills of holes 2 Includes 5 geotechnical holes

More than 90% of the drill holes are vertical in orientation, with the exception of the geotechnical holes drilled in 2005, 2006 and the pseudo-drill holes (includes raises) representing the underground sampling that was completed by Kerr Addison. The drill holes have been spaced predominantly along an exploration grid with East-West and North-South grid lines equal to 064° and 154° azimuths using the UTM NAD 27 co-ordinate systems. The section spacing between the grid lines is 100 ft with East 1 representing 100 ft east of baseline West 00. The spacing of drill holes varies, but is typically spaced 300-400 ft (approximately 90-120 m) apart between Sections East 18 to West 28. A higher grade mineralization zone has been identified around the underground development area, central deposit, which has been drilled with a density of approximately 100 ft (approximately 30 m) spacing between Sections East 6 to West 10.

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The historical drilling data was originally transferred from paper logs to electronic spreadsheets by Adanac and then entered into a database that was used for the April 2005 Mineral Resource Estimate (Blower, 2005). This database was provided to Golder as ASCII files and was incorporated in the 2006 Ruby Creek Datamine Database. Drill hole information provided by Adanac from the 2004 and 2005 drilling programs, as Microsoft Excel spreadsheets, were incorporated in the Ruby Creek Datamine Database.

The 2006 drilling program added an additional 16 drill holes to this Ruby Creek Deposit as illustrated on Figure 11-1. Figure 11-1 is a plan view of the deposit showing the location of the 266 drill holes from the 2006 Ruby Creek Datamine data and includes the historical exploration grid and the NAD 83 UTM Grid.

The 2006 Ruby Creek Datamine Database naming convention for drill holes is based on the various drilling campaigns and included four main groups. The original drill hole names have been re-labelled originally during the 2005 Mineral Resource Estimate (Blower, 2005) with the same naming convention continued in the 2006 Ruby Creek Datamine Database. All drill holes with a prefix of KA for Kerr-Addison, CM for Climax Moly, PD for Placer and AD for Adanac (2004, 2005 and 2006 drilling). Table 11-2 summarizes the drill holes compiled in the 2006 Ruby Creek Datamine Database.

TABLE 11-2: DRILL HOLES IN THE 2006 RUBY CREEK DATAMINE DATABASE

Campaign Years Drill Holes (m)

Kerr Addison Mines (including Adanac Mining and Exploration, & John’s Manville)

1966 – 1972 105 16,897

Climax Molybdenum 1973 7 1,148

Placer Development Limited 1979 – 1980 66 9,975

Adanac Gold Corporation (Adanac Moly Corp.) 2004 36 8,984

Adanac Moly Corporation 2005 19 4,982

Adanac Moly Corporation 2006 16 3,921

Kerr Addison Mine (underground sampling as pseudo (includes raises) drill holes

1972 17 1,005

Total 266 46,912

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The database contains 17 pseudo-drill holes (includes raises) created from the underground sampling program, by Kerr Addison, for a total of 1,005 m. The underground sampling program consisted of representative samples collected from drift rounds in the adits excavated by Kerr Addison. Access to the underground workings is currently not possible. Therefore, a total of 266 drill holes are currently contained within the 2006 Ruby Creek Datamine Database that has been used in the February 22, 2007 Mineral Resource Estimate.

At the time of the 2006 site visit by the QP, approximately 8,000 ft of drilling (2,400 m) was completed in both HQ and NQ sized drill core in 12 drill holes. An additional 4 holes were completed by the end of September for a total drill program of 16 holes and 3,921 m of core. Of the 12 holes drilled, assayed results for 4 holes were complete with 4 holes being processed by ACME and 4 holes to be submitted to ACME.

No drilling was occurring during the QP site visit (August 24 and 25, 2005), but core logging, handling, sampling and storage were observed. Two drills were on the property and in the process of moving to other drill hole set-ups. Additionally, no access was available to the underground adits during the site visit and has been that way since Adanac has owned the property.

The drill core logging procedures for 2006 were the same as observed during the 2005 site visit and included the following and are described in Section 12.

All core logging and sampling by the Adanac geologists was first entered on paper logs and later entered electronically onto computers for permanent storage as Excel spreadsheets. After the core was sampled from the core trays, any remaining core (typically half) was stored on wooden-rebar rack structures in their original open core trays. The core rack structures are stored outside, but are protected under wooden roofs. Each core rack structure is labelled with the drill hole name. It was observed during the 2006 site visit that additional core racks have been constructed to store the 2006 drill core in addition to the split core stored from the 2004 and 2005 programs (excluding any samples that used whole core for duplicate sampling, metallurgical and specific gravity testing). There is no core stored on site or available prior to the 2004 drilling program. In Golder’s opinion, the drilling practice, logging, handling and storage of core employed at the Ruby Creek deposit is standard in the industry.

The majority of the drilling completed to date on the Ruby Creek deposit is vertical dipping and the main mineralization to date has been identified as along sub-horizontal veins except in the central area of the deposit which is a mixture of sub-vertical and sub-horizontal veins. Therefore, in general the mineralized drill intercepts are representative of the true thickness with some exceptions in the areas where mineralization is both sub-vertical and sub-horizontal vein hosted.

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FIGURE 11-1: PLAN VIEW OF DRILL HOLES AND EXPLORATION GRID

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12.0 SAMPLE METHOD AND APPROACH

In the drill programs completed prior to 2004, the standard practice was to crush and split all core, saving only a small lithologically representative sample from each 10 ft interval. This approach was taken to (1) minimize handling, (2) reduce molybdenite loss through splitting or sawing, and (3) increase the volume of material sampled – and hence improve sampling statistics.

Therefore, no assay samples or representative drill core samples were available prior to the 2004 drilling program. All samples that were collected from the 2004, 2005 and 2006 drilling programs by Adanac have been sawed or split in half to retain as an inventory of archived core samples with the exception of duplicate, metallurgical, geochemical and specific gravity samples collected from the split core. A few holes were entirely sampled in order to compare to historical assay results. These archived split samples are stored on the permanent core racks on the property site.

The procedure for processing all new core is to take boxes of core to a central building for processing. Groups of 4 boxes are placed on an angled stand, wetted down and photographed using a digital camera. The boxes are then placed on open-air benches and the core logged and marked-up for processing. Each 10 ft interval is: (1) given a multi-digit (assay tag) sample number; (2) measured for percentage recovery; (3) measured for RQD (Rock Quality Designation); and (4), where appropriate, marked with a wax crayon to indicate the required orientation of the core to go through the saw or the splitter. The boxes were then affixed with aluminium tags on one end showing the drill hole number, the box number, and blocks inserted to mark depth.

During the core logging process, samples were selected for assaying. All drill holes were sampled beginning from the bedrock interface. No overburden samples were collected for assaying in the 2004, 2005 and 2006 drill programs. Sample selection was a combination of lithology type and length. The typical sample length was 3.05 m (10 ft) which was the same length as the drill core run and similar to historical sample lengths previously collected. The maximum (4.8 m) and minimum (1.2 m) samples lengths collected in 2004, 2005 and 2006 programs were typically the first or last samples collected in each drill hole.

As part of Adanac’s QA/QC program approximately 5% of the material left in the boxes (split samples) are analyzed as duplicate samples. In addition to the core duplicate samples, several sets of representative samples (0.5 m to 0.1 m long) were collected from the archived split samples for specific gravity, acid generating potential determination and metallurgical testing. A

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total of approximately 1,000 samples have been collected from the 2004, 2005 and 2006 drilling programs for specific gravity testing (approximately 50 ft spacing). Therefore, the residual core left on site is incomplete. Most of the specific gravity and representative samples taken from the 2006 drill core are in the company office in White Rock, British Columbia.

Although the process of sawing or splitting the core can cause some loss of molybdenite, it is worth noting that the drill hole recoveries returned in the 2004 through 2006 programs were often higher (>95%) when compared to the losses through down-hole erosion that were experienced by either Kerr Addison or Placer.

In practice, the drill core was processed in three ways. The competent sections of the drill holes were either split using a classic hand-cranked core splitter or sawed using a fast and efficient (Almonte) core saw. In each case, half the core was returned to the box and half was bagged for further processing. Core intervals that were structurally weak and/or too poorly consolidated to split were totally crushed and then passed through a riffle splitter three times to homogenize the sample before being split into two halves. One half was then treated in the same way as the other half-core crushed samples obtained by cutting and/or sawing, and the other was double-bagged and stored as a primary crush reject.

During the 2004 drilling program, 3 drill holes were totally crushed to reproduce the sample handling processes that were taken in pre-2004 drilling programs. These holes (AD-303, AD-307 and AD-308) were collared adjacent to pre-existing holes drilled by Kerr Addison (KA-60-117) and Placer (PD-221 and PD-227).

In Golder’s opinion, the sampling procedures used in the 2006 drilling program are consistent with the 2004 and 2005 practices developed and are consistent with industry practices and were representative of the drill hole data collected.

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13.0 SAMPLE PREPARATION, ANALYSES AND SECURITY

13.1 Field Sample Preparation Procedures

2006 Adanac

As discussed in Section 12, all samples selected for assaying were crushed on site to less than approximately 10 mm (3/8") using a Nelson Machinery Atlas core crusher that was cleaned with compressed air before the next sample was crushed. Samples that were crushed were either sawed half samples or whole samples (if unable to be sawed). The crushed samples were then weighed (typically 8.0 kg to 10.0 kg for a sawed sample) and subjected to a systematic splitting process using an industry standard riffle splitter. The process is shown on Figure 13-1 and is the same method used in 2004 and 2005. The original sample (typically 8 kg) was split into two 4 kg samples and they were, in turn, split into four 2 kg samples. Two of these (one from each of the 4 kg splits) were assigned to a reject bag and the remaining two were split to produce four 1 kg samples. Two of these (again, one from each of the original 4 kg splits) were then mixed to form the main assay sample. Where appropriate, the remaining two 1 kg samples were also mixed to make a primary crush duplicate.

The same splitting process was used for samples that were unable to be sawed, except a larger sample was retained since these samples were not stored in the core racks but with the primary crush duplicates. Those samples (main and duplicate) selected for analysis were then weighed, assigned their assay tags and sealed using a single-use cinch-tie. The samples were shipped to ACME in rice-sacks. Golder observed the 2005 and 2006 field sample preparation procedures and found them to be consistent with industry standards.

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FIGURE 13-1: ADANAC FIELD SAMPLE PREPARATION PROCEDURES

8.0 kg

4.0 kg 4.0 kg

2.0 kg

1.0

2.0 kg 2.0 kg 2.0 kg

1.0 1.0 1.0

2.0 kg 2.0 kgMain Sample, for Acme Labs.

Duplicate Sample, if requested.

6.0 kgor 4.0 kg

Reject for storage

Half Core8.0 kg

4.0 kg 4.0 kg

2.0 kg

1.0

2.0 kg 2.0 kg 2.0 kg

1.0 1.0 1.0

2.0 kg 2.0 kgMain Sample, for Acme Labs.

Duplicate Sample, if requested.

6.0 kgor 4.0 kg

Reject for storage

Half Core

*From Pinsent (2005)

2004, 2005 Adanac

The core was handled in the same manner as in 2006 Adanac described above.

The sampling procedures used prior to Adanac’s 2004, 2005 and 2006 drilling programs are summarized in Palmer (2006) and Blower (2005).

13.2 Laboratory Sample Preparation Procedures

Samples from the 2006 drilling program were submitted to ACME for molybdenum analysis and trace element analysis. Check sampling and specific gravity sampling was submitted to ALS Chemex. Additionally, a total of 186 crushed reject samples from 14 drill holes (AD-356 to AD-368) were submitted to G&T Metallurgical Services for flotation testing.

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2004, 2005 and 2006 Adanac

Samples collected during the 2004, 2005 and 2006 campaigns for molybdenum and trace element assaying were prepared in the same manner in the ACME laboratory. Samples were crushed to 70% passing 10 mesh and splits weighing 250 g were then pulverized to 95% passing -150 mesh.

Sample preparation prior to the 2004 drilling program was based on information provided in the Technical Reports by Palmer (2006) and Blower (2005).

13.3 Analytical Procedures

2006 Adanac

The molybdenum assaying method that was applied to all the 2006 samples (including blanks, duplicates and standard samples) by ACME was the multi-element method. This method takes a 1.0 gram split pulverized sample first digested by aqua regia and then analyzes the resultant solution for molybdenum (Mo%) using Inductively Coupled Plasma Emission Mass Spectrometry (ICP-MS).

Trace element assaying of the 2006 samples by ACME was prepared the same as above and then a 0.25 gram sample was heated in HNO3-HCLO4-HF to fuming and taken to dryness. The residue sample was dissolved in HCL and the resultant solution was then analyzed for 41 elements (parts per million) using ICP-MS.

Note that the values returned are the total molybdenum content of the rock, as they combine the sulphide with any oxide molybdenum that may be present. However, in practice, previous work showed that there is little or no molybdenum present in oxide form. In Golder’s opinion, the ICP method is the best practice for measuring the molybdenum content of molybdenite mineralization in rock.

2004 and 2005 Adanac

The same procedures used in 2006 were also used in 2004 and 2005 and are described above.

Analytical procedures for samples assayed prior to the 2004 were based on information provided in the Technical Reports by Palmer (2006) and Blower (2005).

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13.4 Quality Assurance and Quality Control

13.4.1 Procedures

In 2006, Adanac employed a comprehensive program of QA/QC consisting of inserted blanks (5%), standards (5-10%) and duplicate samples (5%). The program employed in 2006 followed the same QA/QC program as the one developed in 2004 and 2005, which is described in the Technical Reports by Palmer (2006) and Blower (2005). There is no information available on QA/QC procedures or results from the drilling completed prior to 2004. Samples submitted to ACME included split drill core samples, blanks (two types) and standards (two types). Golder reviewed the assaying results from the duplicates, blanks and standards that were provided by Adanac. A description of 2006 procedures for the blanks, standards and duplicates is as follows.

Blanks

Blank samples were inserted in the sample stream to monitor contamination. Adanac used two types of blanks: (1) bags of pre-crushed, commercially purchased, poultry grit quartzite (Blank), and (2) locally derived volcanic scoria from Ruby Mountain, west of Ruby Creek (Blank-S). The poultry grit blanks did not go through the on-site crusher and were inserted as a standard. However, those designated as Blank-S, composed of locally derived volcanic scoria from Ruby Mountain, did go through the crusher and they provide a check on sample to sample contamination during the crushing process. Approximately 5% of the samples submitted for a drill hole included blank samples with no molybdenum mineralization.

Standard Reference Material

Adanac 2006

During the 2006 drilling program, two commercially purchased molybdenum standards were included as standard reference materials during the submission of drill core samples to ACME for both standard ICP-MS molybdenum assaying and trace element assaying. These standards included WCM Cu 111 and WCM Cu 132. The standard assaying results for WCM Cu 111 is 0.83% Cu, 0.117% Mo and 105 g/t Ag. The standard assaying results for WCM 132 is 0.17% Cu, 0.045% Mo and 27 g/t Ag and 0.17 g/t Au.

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Reject and Pulp Duplicates

During analysis, ACME also inserted reject duplicates from a second 250 g split from the original sample, and pulp duplicates from a second split from the original pulp, as requested by Adanac.

13.4.2 Results –2006 Samples

The analytical methods employed on the 2006 samples from the Ruby Creek deposit by ACME were the same as those used during the 2004 and 2005 sampling programs. The ICP-MS analytical method used on the 2006 samples considered the best practice for measuring the molybdenum content in the drill core samples.

The assay results from the blanks, standards and duplicates from the 2006 QA/QC program were reviewed by Golder with the following results:

• 18 Blank samples were reviewed and had an assay range between 0.0005 and 0.004% Mo. Only one sample had an assay of 0.004% Mo with the remaining at or below 0.001% Mo.

• 27 Blank-S samples were reviewed and had an assay range between 0 (below detection) and 0.006%Mo.

• 39 WCM Cu 111 standard samples were reviewed and had a range of 0.103 and 0.123% Mo with a mean and standard deviation of 0.111% and Mo 0.0049% Mo, respectively. Only 1 of the 39 samples exceeded 2 standard deviations.

• 39 WCM Cu 132 standard samples were reviewed and had a range of 0.0398 and 0.048% Mo with a mean and standard deviation of 0.0432% and Mo 0.002% Mo, respectively. Only 1 of the 39 samples exceeded 2 standard deviations.

• 172 duplicate samples were reviewed using Q-Q plots of assay 1 versus assay 2. In general, these plots showed reasonable agreement with some outliers occurring at all grades (both low and high).

Therefore, in general, there appears to be no contamination in the samples crushed on site since the Blank-S samples had a maximum assay of 0.006% Mo. Also, the standards and second blanks submitted show no obvious contamination and reasonable accuracy and precision with only 2 of the 78 standards reviewed exceeding 2 standard deviations above their recorded assay grade. The duplicate samples reviewed also showed reasonable agreement, which indicates reasonable precision and no contamination between samples. The review of the 2006 sampling program indicates that the samples were sufficiently accurate, free from contamination, precise, under control and were included in the Ruby Creek Datamine Database for the calculation of the February 22, 2007 Mineral Resource Estimate.

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14.0 DATA VERIFICATION

The data verification checks that were completed on the drill hole data prior to them being used in the February 22, 2007 Mineral Resource Estimate included the following:

1. A check of the drill hole data against original spreadsheet records in the database.

2. A review of the 2006 blanks, duplicate (Q-Q plots) and standards.

3. Site visit completed on August 22, 2006 to review core logging and sampling procedures. No independent samples were collected during the site visit, but visible molybdenum mineralization was observed and independent samples were collected in 2004 (Blower, 2005) and 2005 (Palmer, 2006).

Verification checks were completed on the 2005 and earlier data and are provided in the Technical Reports by Palmer (2006) and Blower (2005). The data verification checks completed on the 2006 data is discussed above with the exception of the drill hole co-ordinate translation from UTM NAD-27 to UTM NAD 83 and as described in the following sections.

Approximately 5% of the 2006 drill hole Excel spreadsheets were visually reviewed against the Datamine drill hole database. The drill hole samples in the database prior to 2004 were provided as ASCII files. These ASCII files were provided from AMEC based on electronic spreadsheets provided by Adanac. These drill hole samples were added to the Ruby Creek Datamine Database created in 2006 and were visually checked against the 3D geological and mineralization models created.

No significant discrepancies were encountered during the check. The collar locations for drilling data from 2005 and earlier have undergone a conversion and translation from UTM NAD-27 to UTM NAD 83. Some drill hole samples (pre-2004 historical data) did not have information pertaining to percent recovery and main lithology identification, but were still included in the Mineral Resource Estimate since assay data was available. All drill holes with missing information (i.e. no Mo assay values for overburden samples) were flagged with a negative value (typically -2) and were not included in the mineral estimate.

A review of the 2006 sampling data including blanks, duplicates and standards was completed and is described in Section 13.4.2.

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Golder concludes that the assay and survey data used in the January 2006 mineral estimate were sufficiently free of error to be adequately used for resource estimation of the Ruby Creek Molybdenum deposit.

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15.0 ADJACENT PROPERTIES

For the Ruby Creek Molybdenum Project, this item is not relevant.

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16.0 MINERAL PROCESSING AND METALLURGICAL TESTING

Several campaigns of metallurgical testing have been completed at Adanac, including Kerr Addison’s feasibility study in 1971 (Chapman, Wood & Griswold, 1971) and work has also been completed by Placer Development Limited. The results generally demonstrated that the mineralization is amenable to concentration with standard flotation techniques. In addition, 186 core samples, from the 2006 drilling program, were submitted to G&T Metallurgical Services for metallurgical testing.

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17.0 MINERAL RESOURCE AND MINERAL RESERVE ESTIMATES

17.1 2007 Ruby Creek Mineral Resource Estimate Summary

The Mineral Resource Estimate for the Ruby Creek Molybdenum Project was calculated under the direction of Paul Palmer, P.Geo., P.Eng., of Golder Associates Ltd. as the Qualified Person. Richard Gaze and Dr. Sia Khosrowshahi of Golder Associates Pty. assisted with the geostatistical analysis and Mineral Resource Estimate under the direction of Paul Palmer. This is the second time Paul Palmer has worked for and reported a Mineral Resource Estimate for Adanac Moly Corporation.

The February 22, 2007 Mineral Resource Estimate was based on a 3D geological and block model constructed with commercial mine planning software (Datamine and Vulcan) based on the 2006 Datamine database. Project limits were 588396 to 590896 East, 6619174 to 6621674 North and 700 m to 1900 m elevation (NAD-83 UTM co-ordinates). The previous mineral resource estimates used drill hole collars in the NAD-27 UTM co-ordinate system. The February 22, 2007 Mineral Resource Estimate used drill holes collars in the NAD-83 UTM co-ordinate system. This initially required transferring all the drill hole data (i.e. collar information) and all the previously created 3D geological and mineralization geometries, and generating a new block model based on the NAD-83 UTM co-ordinate system. The block model used in the February 22, 2007 Mineral Resource Estimate was not rotated, measured 20 m east by 20 m north by 12 m (RL-elevation high) and sub-celled to a minimum of 5 m by 5m by 3 m.

The Ordinary Kriging (OK) interpolation method was used for resource estimation of Mo% using variogram parameters defined from the geostatistical analysis that was completed for the 2006 Mineral Resource Estimate. In addition, new variogram parameters were identified from the structural data that was collected from the 2006 inclined drilling program and optical televiewer analysis outlined in Section 7.2.2. Based on this analysis, the new variogram search parameters were changed to a vertical direction search as opposed to a horizontal direction search. The new variogram search parameters were only applied to the central deposit area, which is where the highest drill density and underground data is located. The delineation was accomplished by creating a new 3D mineralized domain (Zone 60) in the central pit area such that the vertical variogram search parameters were applied to Zone 60 and horizontal search parameters were applied to the mineralized domains outside of Zone 60 (partial Zone 6 and all of Zone 7).

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In addition, the 2006 drilling data (16 bore holes) were applied to the current 3D mineralization geometries and modified to reflect the new data including slight interpretation modifications in other area. Based on the updated 3D mineralization geometries, two mineral resource estimates were completed. The first resource estimate (Model 1) is based on using the geostatistical analysis defined from the 2005 and 2006 mineral resource estimates, which used a variography orientation that was horizontal. The second resource estimate (Model 2) is based on using both vertical variography orientation for Zone 60 and horizontal variography orientation for Zones 6 and 7, outside of Zone 60.

Mineral resource estimates for measured, indicated and inferred resources were calculated for each model using cut-off grades between 0.2 and 1.0% Mo. The comparison of the tonnage and grade estimates from each model indicated that the combined measured and indicated tonnage for Model 1 was slightly higher (approximately 0.5% higher) when compared to Model 2 and the grades were the same. Therefore, Model 1 was considered still the most appropriate method in estimating the mineral resource for the Ruby Creek and was used in the February 22, 2007 Mineral Resource Estimate. The Model 2 mineral resource estimate supports the current estimates and should be reviewed again if additional inclined drilling data is collected.

17.2 The Database

The database that was used in the February 22, 2007 Mineral Resource Estimate was constructed initially in Datamine and was completed on drill hole information with the exception of historical sample data from underground development. The majority of the data (approximately 60%) is historical drill hole information (Kerr Addison, Climax and Placer) that has now been updated with drilling programs by Adanac in 2004, 2005 and 2006 and includes a total of 71 drill holes. The Datamine database used in the mineral resource estimate is composed of 266 drill holes and 15,328 samples and is summarized in Table 17-1.

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TABLE 17-1: DRILL HOLE DATA IN THE JANUARY 2006 DATABASE

Campaign Years Drill Hole Prefix No. of Drill Holes

No. of Samples

Percentage of Database (%)

Kerr Addison (Adanac Mining and Exploration, John’s Manville and Kerr Addison)

1966 – 1972 KA 105+17 pseudo -

drill holes 6,073 39.5

Climax Moly 1973 CL (100 Series 7 365 2.4 Placer Development 1979 – 1980 PD (200 Series) 66 3,145 20.5 Adanac Gold Corporation (Adanac Moly Corp.)

2004 AD (300 Series) 36 2,886 18.8

Adanac Moly Corporation 2005 AD (300 Series) 19 1,621 10.6

Adanac Moly Corporation 2006 AD (300 Series) 16 1,238 8.1

Total 266 15,328 100.0 The database is comprised of vertical, inclined drill holes and underground sampling data (pseudo-horizontal drill holes). Each sample in the database has the following attribute information: hole ID, from and to sample distance, total sample length, Mo%, lithological identification (primary and secondary), sample number, percentage recovery and RQD. Samples in the overburden were generally not populated with Mo%, recovery and RQD and some earlier samples did not collect RQD information. Sample lengths in the database were on average 10 ft long (3.05 m). Any data not available was either left as blank in the original database or later flagged with a negative code (-9 or -99).

Historical drill hole data in the Datamine database have been outlined in Sections 6 and 11 of this report, with additional details provided in the Technical reports by Blower (2005) and Palmer (2006).

17.3 The Geological Model

The geological model that was generated for the Ruby Creek deposit comprised 3D wireframe geometries of geological interpretations and a 3D block model created in Datamine and Vulcan software. Six 3D geometries were created: three represented the main lithological units (primary) and three represented the main molybdenum mineralization. One additional mineralization geometry (Zone 60) was included in the February 22, 2007 Mineral Resource Estimate, which

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was located in the central pit area. Two surfaces (DTM) were also used to represent the overburden/bedrock interface and the topographic surface. The 3D block model was composed of a 20 m (x-easting) by 20 m (y-northing) by 12 m (z-elevation) parent blocks that were further subdivided into a minimum of 5 m (x) by 5 m (y) by 3 m (z) sub-celled blocks.

The 3D geometries used in the February 22, 2007 Mineral Resource Estimate were updated from the January 2006 3D geometries based on the new information from the 2006 drilling program (16 bore holes) and slight interpretation modifications in other areas.

The February 2007 3D geometries were used for coding both drill hole data and the block model that defined the spatial zones for the estimation of grades and bulk density assignment in the February 22, 2007 resource model (Model 1). The naming convention used for the February 2007 2D and 3D geometries is illustrated on Figure 17-1 (Local Grid 00) and summarized in Table 17-2. Provided in Appendix B is a selection of cross-sections through the Ruby Creek deposit that includes the 2006 drilling.

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FIGURE 17-1: SECTION VIEW OF 3D MINERALIZATION ZONES AND ROCK TYPES FOR RUBY CREEK DEPOSIT

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TABLE 17-2: 2007 RUBY CREEK GEOMETRIES

Field Value 2D and 3D Wireframe Geometry Description

Rzone 1 ob_nov7.00t Overburden Surface Rzone 2 RZN2.00t Rock Type 2 Rzone 3 RZN3.00t Rock Type 3 Rzone 4 RZN4.00t Rock Type 4 Zone 6 MIN_ZONE.00t Mineralization Zone 6 Zone 7 zone7_nov7.00t Mineralization Zone 7 Zone 60 Mineralization Zone 60 Rzone 19 topo_clipSept27.00t Topographic Surface Zone -99 Background Mineralization

Rzone 1 represents the geometry between the bedrock and the overburden. Rzones 2, 3 and 4 represent a simplified 3D geometry interpretation of the rock types in the Ruby Creek deposit. The lithological units that were classified inside Rzones 2, 3 and 4 are summarized in Table 17-3. The rock types in Rzones 2, 3 and 4 are a simplification of the various lithological units in the Ruby Creek deposit which, for resource modelling purposes, were acceptable to combine in order to define densities and tonnages in the block model. Rzones 2 and 3 rock types are geographically located south of the Adera Fault and Rzone 4 rock types are located geographically north of the Adera Fault.

TABLE 17-3: PRIMARY AND SECONDARY LITHOLOGICAL UNITS AT THE RUBY CREEK MOLYBDENUM PROJECT

Text Code Rock Type Code (RZone) Description

CGQM 2,4 Coarse-Grained Quartz Monzonite CGQM-T 2,4 CGQM – Transition Variety

CQFP 2,4 Crowded Quartz Feldspar Porphyry SQFP 2,4 Sparse Quartz Feldspar Porphyry

CGQM-H 2,4 CGQM – hybrid MQMP 2,4 Mafic Quartz Monzonite Porphyry SQMP 3 Sparse Quartz Monzonite Porphyry CQMP 3 Crowded Quartz Monzonite Porphyry FGQM 2,4 Fine-Grained Quartz Monzonite MFP 2,4 Mafic Feldspar Porphyry BSLT 2,3 Basalt

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Zones 6, 7 and 60 represent the 3D geometry interpretations of the main molybdenum mineralization in the Ruby Creek deposit. The criteria used to classify drill hole samples inside the mineralization zones are summarized as follows:

• Mo% greater than or equal to 0.04%;

• primary or secondary rock identification as either FGQM or aplite dykes; or

• presence of silicification alteration.

The 3D poly lines corresponding to mineralization zones were modified based on the 2006 drilling and only impacted Zones 6 and 60. Considerations were also made for continuity between sections especially where data was not available. The 3D poly lines were then constructed into 3D geometries and validated in Datamine and Vulcan software. Representative sections are illustrated in Appendix A.

Zones 6 and 60 represent the main mineralization located south of the Adera Fault. Zone 60 (inside of Zone 6) also represents the main mineralization in the central area of the deposit in which there is a greater density of sub-horizontal and sub-vertical veining and potentially a breccia/feeder to the deposit. The breccia/feeder zone is located toward the centre of the deposit and was reported to intersect the underground development sampling completed by Kerr Addison. The smaller Zone 7 mineralization geometry is dominated by sub-horizontal veining and molybdenum mineralization located north of the Adera Fault.

Rzone 19 represented the 2D topographic surface over the Ruby Creek deposit. All Mo mineralization outside of Zones 6, 60 and 7 were coded as Zone -99 and represented the low grade (Mo% less than 0.04%) background mineralization. Some mineralization pockets with Mo% greater than 0.04 did occur outside of Zones 6, 60 and 7, but were not included inside these geometries because they were localized high grade pods with no sample data to confirm continuity from section to section.

17.4 Wireframe Validation

Prior to block model generation and populating of the block model, the Datamine 3D geometries were validated in the Vulcan Software using standard wireframe validation check routines and by slicing sections through the individual wireframes for comparisons against the drill hole database. The process verified the following:

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• correct solid triangulation closure;

• consistency, by testing triangle edges;

• self-intersection, by testing for self-crossing triangles; and

• correct spatial location of individual points within the wireframe.

17.5 Data Preparation and Compositing

Drill hole data for the Ruby Creek deposit project was predominantly sampled on 10 ft lengths (3.05 m). The global distribution of raw sample lengths is shown as a cumulative log-probability plot, which is illustrated on Figure 17-2 from Palmer (2006). This plot illustrates that 95% of the data is represented by the 3.05 m length.

Considering the nominal most frequent raw sample interval (approximately 3 m) and the likely vertical mining selectivity for the project, a 6 m down hole compositing interval was selected. This length was a multiple of the nominal approximate 3 m interval and a divisor of the anticipated mining bench height of 12 m, and the block model vertical dimension of 12 m.

Prior to compositing, the raw sample intervals were generated from the Datamine database and flagged to the 3D geometries listed in Table 17-3 and assigned codes for mineralization zone and rock type. The flagged intervals were then uploaded to a new flagged database.

From this flagged database, a 6 m composite file was generated for statistical and geostatistical analysis using run-length down hole compositing. All composites were broken at the 3D mineralized zone contacts (Zones 6, 60 and 7) resulting in some composite lengths of less than 6 m.

Any gaps in the down hole sequence representing unsampled intervals were excluded from the compositing process, with no default values assigned to represent the missing sample intervals. Due to the use of a length-weighting approach in the interpolation method used for resource estimation, residual composites arising from the breaking of 6 m compositing at geological contacts were not removed from the composite dataset.

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FIGURE 17-2: 2006 GLOBAL DISTRIBUTION OF RAW SAMPLE LENGTHS (PALMER, 2006)

No filtering of raw data on the basis of the sample recovery was carried out, mainly due to large amounts of missing values in the recovery data. No relationship between sample recovery and Mo% was evident from a statistical analysis.

17.6 Declustering

The exploration drill holes in the Ruby Creek deposit were on a nominal pattern of 90 m by 90 m (approximately 300 ft by 300 ft) spaced drill holes, with in-fill drilling in the central region of the resource down to 30 m by 30 m (approximately 90 ft by 90 ft) spacing. A location plan of the drilling is shown on Figure 11-1.

Due to the clustered nature of the drill holes, spatial declustering was carried out using a 90 m by 90 m by 12 m moving window in order to achieve more representative global statistics. A standard cell declustering algorithm was applied to determine the declustering weights.

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17.7 Spatial Trend Analysis

Spatial trend analysis was carried out independent of domain contacts in 2006 to assess grade trends in Mo% content across the resource and is provided in Palmer (2006). This was done using fixed block averages, where 6 m composite data was averaged into 90 m by 90 m by 12 m blocks across the resource, and the mean block grades displayed spatially. This provides an indication of whether there are particular grade orientations or zonation of elevated grade that need to be accounted for in the resource estimation. The spatial trend analysis showed some indication of a southeasterly grade trend.

17.8 High-Grade Treatment

High-grade treatment for estimation was applied using a spatial restraining method to avoid over-estimating the grade of Mo% in the resource domains. In this method, samples above a designated threshold are flagged to individual blocks in the model and their spatial influence restricted to a single block. Therefore, instead of capping high grade values, they were restricted spatially.

Preliminary high-grade thresholds were selected from an examination of cumulative log-probability plots for each domain, and refined through estimation validations of the reproduction of the estimated mean domain grade in the Kriging. After the preliminary estimate and model validations were run, high-grade thresholds were adjusted where required, and the model re-estimated.

A summary of the high grade thresholds implemented in the grade estimation is provided in Table 17-4.

TABLE 17-4: HIGH-GRADE THRESHOLDS FOR MO% BY ZONE

Mineralized Zone Mo% High-Grade Threshold

Approx. Distribution Percentile

6 and 60 0.3 99.5 7 0.2 97.5

-99 0.15 99.7

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17.9 Variogram Analysis

17.9.1 Variography Objectives and Approach

The objectives of the variographic analysis were the following:

• to establish the directions of major grade continuity for each element in the domains; and

• to provide variogram model parameters for use in geostatistical grade interpolation.

The variographic analysis was competed using in-house Golder software and was based on the 6 m composited Mo% data for the combined Zones 6, 60 and 7. Conventional 3D directional variography was used for spatial continuity analysis using 3D conical search methodology. Spherical scheme models were used for modelling of the major, semi-major and minor orthogonal directions of continuity. These models were generated during the 2006 Mineral Resource Estimate and are provided in Palmer (2006). The variogram parameters used in the February 22, 2007 Mineral Resource Estimate were taken directly from the 2006 analysis in Palmer (2006). In addition, a new variogram analysis was used, based on the structural data from the 2006 inclined drilling program. The new variography analysis was applied to the mineral Zone 60 to determine if using the new variogram parameters better defined the grade of the Mineral Resource Estimate in this area. The results from the new variogram analysis were not significantly different than the 2005 variogram analysis. The grades from Zone 60 were not significantly different; therefore, the 2005 variogram analysis (horizontal variogram) from 2006 was used in the February 22, 2007 Mineral Resource Estimate.

17.9.2 Summary of Variography Parameters

Table 17-5 provides a summary of variography model parameters and orientations modelled for the combined mineralized Zones 6, 7 and 60, determined in the 2006 Mineral Resource Estimate (Palmer, 2006).

Linear orientations are defined in terms of plunge and plunge direction (i.e. plunge plunge direction). Resultant planes are defined in terms of dip and dip direction (i.e. dip dip direction).

The ‘separation’ is the angle between the major and semi-major vectors. The ‘rotation’ applies to the semi-major axis; it is the angle required to rotate the search ellipsoid around the major axis vector to align the ellipsoid with the interpreted resultant plane for grade interpolation.

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TABLE 17-5: VARIOGRAPHY PARAMETERS FOR ZONES 6 AND 7

Correlogram Parameters for Mo% Grades Structure 1 Structure 2

Axis Direction Nugget Diff. Sill Range Diff. Sill Range Nugget/Sill Major Axis 0.300 0.340 42.50 0.320 125.00 31

Semi-Major Axis 0.300 0.200 39.00 0.580 137.00 28 Minor Axis 0.300 0.510 15.50 0.170 98.50 31

Major Axis Semi-Major Axis Resultant Plane Major & Semi-Major Rotation Angles Mineralization

Zone Plunge/Direction Plunge/Direction Dip/Dip Direction Separation Angle R1/R2/R3

6, 60 and 7 0 140 0 050 0 050 90 140/0/0

KEY: R1/R2/R3 Search orientations (conventional left hand rule) R1 = azimuth rotation clockwise from north R2 = plunge along R1 direction (+ve = up, -ve = down) R3 = dip rotation around R1-R2 axis (+ve = anticlockwise, -ve = clockwise}

17.10 Update Block Model Parameters

A block model was constructed to cover the mineralization in the Ruby Creek deposit and sufficient surrounding waste for inclusion into open pit designs. The dimensions of the model are provided in Table 17-6 and illustrated including mineralization Zone 6 (green) and 7 (yellow) on Figure 17-3 (and Appendix B).

TABLE 17-6: BLOCK MODEL DIMENSIONS FOR RUBY CREEK RESOURCE MODEL

Minimum Maximum Block size (m)

No. of blocks

Sub-block size(m)

Easting (X) 588 396 590 896 20 125 5.0

Northing (Y) 6 619 174 6 621674 20 125 5.0

RL (Z) 700 1900 12 100 3.0

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FIGURE 17-3: PLAN VIEW OF BLOCK MODEL GEOMETRY

Blocks were filled inside each of the wireframed geological interpretations in a priority sequence to create the geological zones.

Two separate variables were established for mineralized zone (Zones 6, 60, 7 and -99) and rock type (Rzones 1, 2, 3, 4 and 19). Grade interpolation was constrained to the mineralized zone interpretations. Rock type was used for applying the density and corresponding tonnage.

Sub-blocks were used in each model to define the geological zone boundaries and the topography. Sub-blocks were estimated to the parent cell to help achieve acceptable local estimation quality.

17.11 Grade Interpolation

17.11.1 Grade Interpolation Methods and Objectives

The OK interpolation method was used for the resource estimation of Mo% for the Ruby Creek Molybdenum Project using variography parameters defined from the geostatistical analysis.

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The resource estimation reflects an in situ resource estimate based on a nominal block selectivity of 20 m by 20 m by 12 m. No allowance has been incorporated for higher SMU selectivity or ore loss and dilution assumptions.

17.11.2 Ordinary Kriging Plan

The Kriging plan parameters used for grade interpolation Mo% are summarised in Table 17-7 with details provided as follows:

• All mineralized zones were estimated individually with their own data (hard boundary conditions). Waste zones were estimated with parameters from the mineralized zone.

• Sample weights were determined by the variogram model parameters (kriging approach).

• Block discretisation was set to 5 (x) by 5 (y) by 3 (z) to estimate block grades of 20 m by 20 m by 12 m parent blocks. Estimation of sub-cells in the model was performed to the parent cell size, so sub-cells received the parent cell estimate of 20 m by 20 m by 12 m.

• A maximum of four samples per discretised block was used, which equates to a maximum of 32 samples per estimate.

• OK was applied in three passes. Pass 1 used a search of 70 m by 70 m by 12 m. Pass 2 used a search of 140 m by 140 m by 24 m to estimate blocks not estimated in Pass 1, or blocks estimated in Pass 1 with less than two drill holes. Pass 3 used a 280 m by 280 m by 24 m to estimate blocks not estimated in the first two passes, but using a minimum of one sample. Pass 3 was designed to fill any remaining gaps in the model. Pass 3 in the waste zone (zone=-99) was set to the same dimension as the second pass, but with a minimum of two samples to limit grade extrapolation.

• Estimation was weighted by the sample length to account for variations in sample length due to the compositing process.

• High grades above the thresholds were spatially restrained to a single block for grade estimation to control the influence of the high grades. Therefore, high-grade values were restricted to the 20 m by 20 m by 12 m parent block.

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TABLE 17-7: RUBY CREEK DEPOSIT KRIGING PLAN PARAMETERS

Estimation Method Ordinary Kriging Search radius (pass 1/2/3)

X 70/70/12 Y 140/140/24 Z 280/280/24

Anisotropy (OK) X Defined by Variogram Y Defined by Variogram Z Defined by Variogram

Discretisation X 5 Y 5 Z 2

Search type Octant Minimum No. samples 4/4/1

Maximum No. samples per octant 4 17.12 Density Assignment

Adanac supplied Golder with the results of specific gravity samples that were analyzed by ALS Chemex. In all, there is approximately 1,000 samples collected from the 2004 to 2006 drilling programs. A statistical review was completed on the specific gravity samples (Palmer, 2006) based on lithological unit and rock type zone (Rzones 2, 3 or 4). The minimum, maximum and mean specific gravity estimates are summarized in Table 17-8. The mean bulk densities were assigned to all blocks in the model based on rock type using the values in Table 17-8.

TABLE 17-8: ROCK TYPE BULK DENSITY ASSIGNED TO THE BLOCK MODEL

Rock type Min Bulk Density

Max Bulk Density

Mean Bulk Density

Default rock type 2.57

Rzone 2 2.19 2.88 2.57

Rzone 3 2.22 2.63 2.57

Rzone 4 2.37 2.71 2.55

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All the specific gravity samples for the current Datamine database (approximately 22% of database) were based completely on the 2004 - 2006 drilling samples. No specific gravity information was available from the historical data. Therefore, a representative amount of specific gravity samples have been collected from the 2004 - 2006 drilling programs. Additional samples should be collected from any future drilling programs to continue to expand the dataset, specifically in areas where no specific gravity sample data has been collected.

17.13 Mineral Resource Classification

Classification of the resource estimate was based principally on sample data density and geological confidence criteria. Consideration was also given to the classification based on the two previous mineral resource estimates (Blower, 2005 and Palmer, 2006) in order to achieve some continuity in terms of changes in proportions of resource categories with the additional drilling.

The previous mineral resource estimates used a confidence interval scheme for classification as follows (Blower, 2005):

• Measured Resource: estimates within +/- 15% at 90% confidence for quarterly production

• Indicated Resource: estimates within +/- 15% at 90% confidence for annual production

The application of this method indicated that the following drill densities were applicable with respect to resource categories:

• Measured Resource: drill hole spacing of 30 by 30 m or less

• Indicated Resource: drill hole spacing of >30 by 30 <90 by 90 m

• Inferred Resource: drill hole spacing of greater than 90 by 90 m.

Based on the mineralization style at Ruby Creek and the continuity identified from the variography studies, the above drill hole spacings were considered an acceptable method for resource classification of the Ruby Creek deposit and were used in the February 22, 2007 Mineral Resource Estimate.

The February 22, 2007 Mineral Resource Estimate included resource classification by digitising polygons on cross-section for both Indicated Resources (drilling <= 90 by 90 m) and Measured Resources (drilling <= 30 by 30 m) to better define the initial classification boundaries.

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The following conditions were also applied to the mineral resource estimate (using Vulcan scripts):

• Initially, all blocks were set to an Inferred Resource.

• Blocks inside the indicated 3D geometry were set to Indicated Resource.

• Blocks inside the measured 3D geometry were set to Measured Resource.

• Measured blocks were downgraded to an Indicated Resource if the average weighted interpolation distance was greater than or equal to 50 m or the number of drill holes used to estimate the block was less than four.

• Measured blocks initially defined by the measured 3D geometry but located outside the main mineralization zones (Zones 6, 60 and 7) were downgraded to an Indicated Resource.

• All blocks estimated with less than two drill holes per block were downgraded to Inferred Resource.

The following resource classification codes were used in the block model:

• Measured Mineral Resource (class = 1);

• Indicated Mineral Resource (class = 2); and

• Inferred Mineral Resource (class = 3).

17.14 Mineral Resource Summary

The Ruby Creek Mineral Resource Estimate is summarised in Table 17-9 reported at Mo% cut-offs from 0.02 to 0.10% (resource tabulation convention is greater than or equal to the cut-off).

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TABLE 17-9 FEBRUARY 22, 2007 MINERAL RESOURCE ESTIMATE

RUBY CREEK MOLYBDENUM PROJECT

Resource Category Cut-off (Mo%) Tonnage Mo% Mo lb

0.020 55,831,000 0.068 83,698,000

0.030 54,300,000 0.069 82,600,000

0.040 49,106,000 0.073 79,029,000

0.050 41,389,000 0.078 71,172,000

0.060 30,151,000 0.086 57,165,000

0.070 21,909,000 0.094 45,403,000

0.080 14,556,000 0.104 33,374,000

0.090 10,411,000 0.112 25,706,000

Measured

0.100 6,612,500 0.122 17,785,000

0.020 387,278,000 0.042 358,593,000

0.030 238,954,000 0.052 273,935,000

0.040 163,801,000 0.060 216,669,000

0.050 109,444,000 0.067 161,658,000

0.060 61,471,000 0.077 104,350,000

0.070 37,664,000 0.084 69,749,000

0.080 18,813,000 0.094 38,987,000

0.090 9,848,100 0.102 22,145,000

Indicated

0.100 4,286,900 0.113 10,680,000

0.020 443,108,000 0.045 442,290,000

0.030 293,254,000 0.055 356,535,000

0.040 212,907,000 0.063 295,699,000

0.050 150,834,000 0.070 232,831,000

0.060 91,621,000 0.080 161,513,000

0.070 59,573,000 0.088 115,151,000

0.080 33,369,000 0.098 72,360,000

0.090 20,259,000 0.107 47,851,000

Measured +

Indicated

0.100 10,899,000 0.118 28,464,000

0.020 135,737,000 0.032 95,759,000

0.030 48,456,000 0.045 48,072,000

0.040 24,973,000 0.054 29,730,000

0.050 11,631,000 0.064 16,411,000

0.060 5,194,300 0.077 8,817,500

0.070 2,626,200 0.089 5,152,900

0.080 1,239,700 0.103 2,815,000

0.090 821,310 0.113 2,046,000

Inferred

0.100 493,790 0.125 1,360,800

Cut-off Mo% grades were classified as greater than or equal to

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18.0 OTHER RELEVANT DATA AND INFORMATION

No other data or information is relevant for this report.

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19.0 CONCLUSIONS AND RECOMMENDATIONS

A third mineral resource estimate for the Ruby Creek Project has been completed and reported. Some general conclusions and recommendations from the February 22, 2007 Mineral Resource Estimate are as follows:

• The geology of the Ruby Creek Molybdenum Project is well understood.

• Data from the 2006 field program which included 16 drill holes with a combined length of 3,921 m has been added to the previous database. The objective of the 2006 field program was to potentially intersect sub-vertical and vertical vein mineralization in the central pit area using inclined drilling.

• The inclined drilling did nominally intersect higher grade mineralization and therefore should be considered for future exploration programs.

• The current diamond drill database includes 266 drill holes with a combined length of 46,912 m. Adanac, in the past three years, has completed 71 drill holes with a combined length of 17,887 m.

• The drill hole database and all surfaces, geometries and models used in the 2007 mineral resource were converted to the NAD 83 UTM co-ordinate system. This conversion was based on a combination of drill holes surveyed in NAD 83 UTM and the moving of historical holes, model surfaces and geometries from NAD 27 UTM to NAD 83 UTM by adding 174N (Y), and subtracting 104E (X).

• The database was reviewed by Golder using statistical and geostatistical analyses and comparisons between field logs and the digital database This database was considered acceptable for mineral resource estimation.

• The geological, mineralized and block models were generated using Datamine and Vulcan software and were comprised of 3D wireframed geometries of geological interpretations based on the drilling information from the database. These models were used to flag the sample data for the statistical analyses.

• A global density of 2.57 g/cm3 applies to the overall mineralized envelope. To date, over 1,000 samples have been collected from the 2004 to 2006 drilling programs. Very little difference has been identified from the various lithological units. Ongoing sampling should be considered if new lithological samples have been identified in areas where only pre-2004 drilling was available and if the sulphide content of the samples is higher than typically collected.

• The OK interpolation method was used for resource estimation purposes using variography parameters defined from the geostatistical analysis. This method provided an in situ estimation based on blocks of 20 m (x) by 20 m (y) by 12 m (z). All drill hole data was treated using the same variogram parameters defined from the 2006 analysis. Depending on

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the results of future inclined drilling programs, consideration for using vertical orientated variography should be reviewed.

• Two mineral resource estimate models were completed using different variography search parameters. Based on the estimates from both models, it was decided that the variography search parameters used in 2006 were still appropriate to use and were used in the February 22, 2007 Mineral Resource Estimate.

• The combined measured and indicated February 22, 2007 Mineral Resource Estimate using a 0.04 Mo% cut-off grade is 211,907,000 t, 0.063 Mo% and 295,699,000 Mo lb. This is an increase of 6,532,000 t, and 10,095,000 Mo lb when compared to the January 2006 Mineral Resource Estimate.

• The changes in the February 22, 2007 Mineral Resource Estimate has been attributed to the 2006 inclined drilling program (grade and tonnage) and re-interpretation of the 2006 mineralized geometries (tonnage). The majority of the 2007 drilling is in the Phase 1 proposed pit area and has increased the measured tonnage resource in this area by upgrading material from the indicated resource.

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20.0 REFERENCES

Blower, S. (2005): Technical Report – Mineral Resource Estimate Ruby Creek Molybdenum Project, report dated April 11, 2005. (AMEC Americas Limited).

Chapman, Wood & Griswold Ltd., 1971. Feasibility Study Kerr Addison Mines Limited Adanac Project (Volume II of II – Engineering and Economic Detail).

Janes, R.H. (1971): The Geology of the Ruby Creek Molybdenum Deposit; in Chapman, Wood and Griswold, Economic Feasibility Study, Volume VII, pp 1-14 (unpublished).

Monger, J.W.H. (1975): Upper Paleozoic Rocks of the Atlin Terrane, Northwestern British Columbia and South Central Yukon; Geological Survey of Canada, Paper 74 – 47, pp 1-63.

Palmer, P., (2006): Technical Report Mineral Resource Estimate Ruby Creek Molybdenum Project, report dated February 17, 2006, Golder Associates Ltd.

Pinsent, R.H. (1980): Diamond Drilling Report on the Adanac Property, Adera 1, 4-8, Hobo 8, 19-20, 47 and Key 27 Mineral Claims, Atlin Mining Division; British Columbia Ministry of Energy, Mines and Petroleum Resources, Assessment Report #8861, 3 pages plus appendices.

Pinsent, R.H. and Christopher, P.A. (1995): Adanac (Ruby Creek) Molybdenum Deposit, Northwestern British Columbia; Canadian Institute of Mining and Metallurgy Special Volume No. 46, pp 712-717.

Pinsent, R.H. (2005). Diamond Drilling Report on the Adanac (Ruby Creek) Property, British Columbia Ministry of Energy, Mines and Petroleum Resources, Assessment Report, dated January 31, 2005.

Sinclair, W.D. (1995): Porphyry Mo (Low-F-type), in Selected British Columbia Mineral Deposit Profiles, Volume 1 - Metallics and Coal, Lefebvre, D.V. and Ray, G.E., Editors; British Columbia Ministry of Energy of Employment and Investment, Open File 1995-20, pp 93-96.

Sinclair, A.J. (2005) Quality Control of the 2004 Adanac Moly Corp. Drilling Program, Ruby Creek Deposit. Unpublished consultant’s report to Adanac Moly Corp.

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Sutherland Brown, A. (1970): Adera, in Geology, Exploration and Mining in British Columbia, 1969; British Columbia Ministry of Energy, Mines and Petroleum Resources, pp 29-35.

Tennant, S. (1979): Adanac Drill Programme; British Columbia Ministry of Energy, Mines and Petroleum Resources, Assessment Report #7727, 5 pages plus appendices.

White, W.H., Stewart, D.R. and Ganster, M.W. (1976): Adanac (Ruby Creek) in Porphyry Deposits of the Canadian Cordillera, Edited by A. Sutherland Brown; Canadian Institute of Mining and Metallurgy Special Volume No. 15, pp 476-483.

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21.0 SIGNATURE PAGE

The report was prepared and signed by Paul Palmer, a QP as outlined by NI 43-101, and peer reviewed by Kevin Palmer and Sia Khosrowshahi. This Technical Report is dated July 23, 2007.

GOLDER ASSOCIATES LTD. GOLDER ASSOCIATES PTY

“Paul Palmer” “Sia Khosrowshahi”

Paul Palmer P.Geo., P.Eng. Sia Khosrowshahi Associate/Qualified Person Principal/Senior Geostatistician

“Kevin Palmer”

Kevin Palmer, P.Geo. Senior Geologist

PGP/SK/KP/lb

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22.0 STATEMENT OF QUALIFICATIONS AND CONSENT OF AUTHOR

22.1 Statement of Qualifications

I, Paul Palmer, P.Geo., P.Eng., do hereby certify that,

1. I am employed as a Senior Geological Engineer at:

Golder Associates Ltd. 1010 Lorne Street Sudbury, Ontario P3C 4R9.

2. I have read National Instrument 43-101 and this Technical Report.

3. I graduated with a Bachelor’s degree in Geology from Memorial University of Newfoundland. In addition, I have obtained a Bachelor’s degree in Geological Engineering from University of Toronto.

4. I am a member of the Association of Professional Engineers Ontario and the Association of Professional Engineers and Geoscientists of the Province of Manitoba.

5. I have worked as a geological engineer for a total of twelve years since my graduation from university in the mineral resource industry This is my second Technical Report on the property..

6. I am responsible for all sections of the report titled, Mineral Resource Estimate, Ruby Creek Molybdenum Project and dated June 18, 2007) (the “Report”. I visited the Ruby Creek Project site on August 22, 2006 for one day.

7. I have not had prior involvement with the property that is the subject of the Technical Report.

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8. I am not aware of any material fact or material change with respect to the subject matter of the Report that is not reflected in the Report, the omission to disclose of which makes the Report misleading.

9. I am independent of the issuer as described in section 1.4.

Dated this 23rd day of July, 2007. “Paul Palmer” Paul Palmer, P.Geo., P.Eng.

APPENDIX A

2007 MINERAL RESOURCE ESTIMATE, RUBY CREEK MOLYBDENUM PROJECT LETTER DATED MARCH 14, 2007

Golder Associates Ltd. 1010 Lorne Street Sudbury, Ontario, Canada P3C 4R9 Telephone: (705) 524-6861 Fax: (705) 524-1984

OFFICES ACROSS NORTH AMERICA, SOUTH AMERICA, EUROPE, AFRICA, ASIA AND AUSTRALIA

March 14, 2007 05-1117-044

Adanac Moly Corporation 2A 15782 Marine Drive White Rock, British Columbia V4B 1E6

Attention: Mike McLeod, P.Eng. President and CEO/Director

RE: 2007 MINERAL RESOURCE ESTIMATE RUBY CREEK MOLYBDENUM PROJECT

Dear Mr. McLeod,

Golder Associates Ltd. (Golder) is pleased to provide Adanac Moly Corporation (Adanac) a letter report providing the results of the 2007 Mineral Resource Estimate for the Ruby Creek Molybdenum Project (Ruby Creek), located in northern British Columbia. This will be the third time Adanac has publicly reported a Mineral Resource Estimate for Ruby Creek.

Golder was commissioned by Adanac to provide an independent Mineral Resource Estimate in conformance with the Canadian Institute of Mining, Metallurgy and Petroleum (CIM) Mineral Resource and Mineral Reserve definitions referred to in the National Instrument NI 43-101, Standards of Disclosure for Mineral Projects. The resource estimation work was completed in February 2007 and is based on information contained within the upcoming Technical Report currently being prepared by Golder on Adanac’s behalf.

Paul Palmer, P.Geo., P.Eng., an employee of Golder, served as the independent Qualified Person responsible for preparing the Mineral Resource Estimate and the upcoming Technical Report. Mr. Palmer visited the project site on August 22, 2006, while exploration activities were still occurring.

Adanac Moly Corporation March 14, 2007 Mr. Mike McLeod, P.Eng. - 2 - 05-1117-044

Golder Associates

Summarized in Table 1 is the independent 2007 Mineral Resource Estimate for Ruby Creek based on 0.02 to 0.1 Mo% cut-offs for measured, indicated and inferred mineral resource categories. The combined measured and indicated mineral resource estimate using a 0.04 Mo% cut-off grade is 211,907,000 t, 0.063 Mo% and 295,699,000 Mo lb. This is an increase of 6,532,000 t, and 10,095,000 Mo lb when compared to the January 2006 Mineral Resouce Estimate summarized in Table 2. The changes in the 2007 Mineral Resource Estimate has been attributed to the 2006 inclined drilling program (grade and tonnage) and re-interpretation of the 2006 mineralized geometries (tonnage). The majority of the 2007 drilling is in the Phase 1 proposed pit area and has increased the measured tonnage resource in this area by upgrading material from the indicated resource.

The 2007 Mineral Resource Estimate was based on the following factors:

• A site visit completed by Golder on August 22, 2006;

• Data from the 2006 field program which included 16 drill holes with a combined length of 3,921 m. The objective of the 2006 field program was to potentially intersect sub-vertical and vertical vein mineralization in the “pay back” area using inclined drilling;

• The total diamond drill database includes 266 drill holes with a combined length of 46,912 m. Adanac, in the past three years, has completed 71 drill holes with a combined length of 17,999 m;

• The drill hole database and all surfaces, geometries and models used in the 2007 mineral resource were converted to the NAD 83 UTM co-ordinate system. This conversion was based on a combination of drill holes surveyed in NAD 83 UTM and the moving of historical holes, model surfaces and geometries from NAD 27 UTM to NAD 83 UTM by adding 174N (Y), and subtracting 104E (X);

• The database was reviewed by Golder using statistical and geostatistical analyses and comparisons between field logs and the digital database This database was considered acceptable for Mineral Resource Estimation;

• The geological, mineralized and block models were generated using Datamine and Vulcan software and were comprised of 3D wireframed geometries of geological interpretations based on the drilling information from the database. These models were used to flag the sample data for the statistical analyses;

• The Vulcan block model used for Mineral Resource Estimation included a parent block size of 20 m (x) by 20 m (y) by 12 m (z) and was based on the drill hole spacing, continuity of data and potential mining method. In order to provide resolution at geological zone boundaries and the topography, a sub-block size of 5 m (x) by 5 m (y) by 3 m (z) was employed;

• A global density of 2.57 g/cm3 applies to the overall mineralized envelope;

Adanac Moly Corporation March 14, 2007 Mr. Mike McLeod, P.Eng. - 4 - 05-1117-044

Golder Associates

TABLE 1 FEBRUARY 22, 2007 MINERAL RESOURCE ESTIMATE

RUBY CREEK MOLYBDENUM PROJECT

Resource Category Cut-off (Mo%) Tonnage Mo% Mo lb 0.020 55,831,000 0.068 83,698,000 0.030 54,300,000 0.069 82,600,000 0.040 49,106,000 0.073 79,029,000 0.050 41,389,000 0.078 71,172,000 0.060 30,151,000 0.086 57,165,000 0.070 21,909,000 0.094 45,403,000 0.080 14,556,000 0.104 33,374,000 0.090 10,411,000 0.112 25,706,000

Measured

0.100 6,612,500 0.122 17,785,000 0.020 387,278,000 0.042 358,593,000 0.030 238,954,000 0.052 273,935,000 0.040 163,801,000 0.060 216,669,000 0.050 109,444,000 0.067 161,658,000 0.060 61,471,000 0.077 104,350,000 0.070 37,664,000 0.084 69,749,000 0.080 18,813,000 0.094 38,987,000 0.090 9,848,100 0.102 22,145,000

Indicated

0.100 4,286,900 0.113 10,680,000 0.020 443,108,000 0.045 442,290,000 0.030 293,254,000 0.055 356,535,000 0.040 212,907,000 0.063 295,699,000 0.050 150,834,000 0.070 232,831,000 0.060 91,621,000 0.080 161,513,000 0.070 59,573,000 0.088 115,151,000 0.080 33,369,000 0.098 72,360,000 0.090 20,259,000 0.107 47,851,000

Measured +

Indicated

0.100 10,899,000 0.118 28,464,000 0.020 135,737,000 0.032 95,759,000 0.030 48,456,000 0.045 48,072,000 0.040 24,973,000 0.054 29,730,000 0.050 11,631,000 0.064 16,411,000 0.060 5,194,300 0.077 8,817,500 0.070 2,626,200 0.089 5,152,900 0.080 1,239,700 0.103 2,815,000 0.090 821,310 0.113 2,046,000

Inferred

0.100 493,790 0.125 1,360,800

Adanac Moly Corporation March 14, 2007 Mr. Mike McLeod, P.Eng. - 5 - 05-1117-044

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TABLE 2 JANUARY 2006 MINERAL RESOURCE ESTIMATE

RUBY CREEK MOLYBDENUM PROJECT

Resource Category Cut-off (Mo%) Tonnage Mo% Mo lb 0.020 40,636,000 0.077 68,982,000 0.030 40,386,000 0.077 68,557,000 0.040 38,942,000 0.079 67,822,000 0.050 35,834,000 0.081 63,990,000 0.060 28,836,000 0.088 55,942,000 0.070 22,593,000 0.094 46,820,000 0.080 15,225,000 0.104 34,907,000 0.090 10,601,000 0.112 26,175,000

Measured

0.100 6,908,000 0.121 18,427,000

0.020 432,936,000 0.041 391,325,000 0.030 261,618,000 0.051 294,149,000 0.040 167,433,000 0.059 217,782,000 0.050 113,435,000 0.066 165,052,000 0.060 63,101,000 0.076 105,725,000 0.070 37,572,000 0.083 68,751,000 0.080 17,543,000 0.094 36,355,000 0.090 8,808,000 0.103 20,001,000

Indicated

0.100 4,151,000 0.113 10,340,000

0.020 473,572,000 0.044 460,307,000 0.030 302,004,000 0.054 362,706,000 0.040 206,375,000 0.063 285,604,000 0.050 149,269,000 0.070 229,042,000 0.060 91,937,000 0.080 161,667,000 0.070 60,165,000 0.087 115,571,000 0.080 32,768,000 0.099 71,262,000 0.090 19,409,000 0.108 46,176,000

Measured +

Indicated

0.100 11,059,000 0.118 28,767,000

0.020 151,326,000 0.034 113,429,000 0.030 61,837,000 0.048 65,437,000 0.040 33,067,000 0.060 43,740,000 0.050 23,225,000 0.067 34,305,000 0.060 13,375,000 0.076 22,409,000 0.070 6,490,000 0.088 12,591,000 0.080 3,166,000 0.102 7,120,000 0.090 1,915,000 0.113 4,771,00

Inferred

0.100 1,143,000 0.124 3,124,000

APPENDIX B

SELECTION OF VERTICAL SECTIONS AND PLAN DRAWINGS, RUBY CREEK MOLYBDENUM PROJECT

CQMP

SQFP

CGQM

SQFP

CGQM

SQMP

SQMP

CGQM

SQMP

SQFP

AD

-365

KA

-DR

IFT-3

KA

-JM-1

KA

-RAI

SE

8

KA

-120

KA

-122

KA

-53-97

KA

-54

KA

-55

KA

-56

0.0270.071

0.0380.03

0.0360.07

0.0560.055

0.1010.097

0.0180.0430.0390.0570.0760.059

0.034

0.059

0.016

0.038

0.064

0.055

0.041

0.088

0.038

0.038

0.041

0.066

0.11

0.062

0.042

0.036

0.066

0.068

0.065

0.031

0.031

0.032

0.026

0.022

0.024

0.016

0.029

0.022

0.031

0.026

0.022

0.024

0.031

0.015

0.017

0.060.072

-

-

0.014

0.009

0.036

0.02

0.014

0.012

0.024

0.014

0.053

0.021

0.045

0.015

0.026

0.039

0.015

0.032

0.018

0.008

0.044

0.036

0.07

0.062

0.12

0.057

0.025

0.026

0.027

0.011

0.014

0.012

0.0280.032

-

-

0.002

0.029

0.021

0.023

0.015

0.057

0.017

0.013

0.033

0.017

0.011

0.013

0.02

0.031

0.037

0.023

0.031

0.057

0.025

0.027

0.033

0.05

0.048

0.049

0.038

0.042

0.028

0.022

0.043

0.007

-

-

-

-

0.07

0.106

0.033

0.067

0.071

0.037

0.035

0.05

0.052

0.041

0.053

0.046

0.106

0.061

0.056

0.039

0.049

0.041

0.071

0.05

0.075

0.034

0.006

0.008

0.049

0.051

0.043

0.01

0.028

0.059

0.044

0.05

0.048

0.033

0.038

0.036

0.038

0.043

0.13

0.046

0.049

0.061

0.044

0.022

0.048

0.044

0.024

-

0.01

0.0310.0440.039

0.02

0.045

0.034

0.034

0.049

0.039

0.077

0.074

0.065

0.057

0.054

0.098

0.08

0.047

0.072

0.078

0.051

0.059

0.035

0.051

0.082

0.045

0.028

0.046

0.054

0.044

0.038

0.054

0.009

0.008

0.006

0.007

0.008

0.01

0.015

0.009

0.01

0.012

0.023

0.014

0.014

0.014

0.014

0.039

0.013

0.011

0.009

0.011

0.012

0.01

0.016

0.019

0.01

0.040.035

5890

00 E

589000 E

5891

00 E

589100 E

5892

00 E

589200 E

5893

00 E

589300 E

6619

700

N

6619700 N

6619

800

N

6619800 N

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N

6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 30.48 EAST 4

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83

CGQM

FGQM

CGQM

MQMP

CQMP

SQMP

OVB

CQMP

CGQM

MQMPFGMPMQMP

SQMP

OVB

CGQM

MQMPSQMP

MQMPFGQM

SQMP

no sampl

CGQM

SQMP

CQMP

SQMP

CGQM

CGQM

FGQM

CGQM

CGQM

FGQM

CGQM

MQMP

CGQM

CGQM

FGQM

CGQM

FGQM

CGQM

MQMP

SQMP

100

CGQM

FGQM

CGQM

FGQM

CGQM

FGQMCGQMMQMP

CGQM

MQMP

SQMP

CGQM

FGQM

MQMP

CGQM

MQMP

SQMP

SQMP

FGQMCGQM

FGQM

CGQMFGQMCQFP

SQFP

CQFP

SQMPBSLT

SQMP

AD

-301

AD

-356

AD-3

57

AD

-358

AD

-359

AD

-361

AD

-362

AD

-364

AD

-368

KA

-DR

IFT-3

KA

-RAI

SE

2

KA

-RAI

SE

3

KA

-RAI

SE

4

KA

-RAI

SE

5

KA

-RAI

SE

6

KA-XCN-1-1KA-XCN-1-2 KA-XCS-1-1 KA-XCS-1-2KA-XCS-1-4 KA-X3S-1-3K

A-107

KA

-108KA

-109

KA

-110

KA

-121

KA

-1-92

KA

-2-91

KA

-62

KA-63

KA

-70-94

KA

-71

KA

-73

KA

-94-70

KA-95-124

PD

-212

PD

-217

PD

-241

PD

-246

-

0.02

0.043

0.036

0.041

0.119

0.099

0.135

0.119

0.119

0.068

0.024

0.033

0.185

0.056

0.073

0.09

0.14

0.214

0.166

0.102

0.067

0.055

0.038

0.097

0.064

0.044

0.089

0.086

0.033

0.026

0.035

0.01

0.017

0.08

0.019

0.049

0.03

0.109

0.112

0.096

0.055

0.028

0.134

0.095

0.048

0.041

0.041

0.048

0.043

0.0440.0930.021

0.018

0.023

0.064

0.024

0.021

0.006

0.016

0.01

-0.002

0.0020.022

0.041

0.120.159

0.1350.2610.199

0.030.026

0.0180.013

0.0190.057

0.0660.012

0.0290.037

0.0030.002

0.0080.0080.0070.012

0.012

0.0910.0760.0650.0620.1120.1660.0730.0680.087

0.0810.054

0.0530.082

0.0580.051

0.0330.073

0.072

-

0.0180.020.029

0.0510.0550.0650.0830.0940.047

0.0780.074

0.2440.1460.1440.19

0.2140.22

0.1

0.117

0.077

0.101

0.079

0.097

0.089

0.075

0.072

0.071

0.165

0.143

0.327

0.153

0.136

0.1760.099

0.171

0.152

0.089

0.043

0.070.085

0.116

0.124

0.092

0.03

0.0280.034

0.081

0.083

0.043

0.037

0.0370.037

0.1610.082

0.141

0.116

0.099

0.13

0.188

0.216

0.152

0.146

0.106

0.172

0.143

0.122

0.221

0.178

0.168

0.176

0.115

0.098

0.071

0.084

0.081

0.079

0.133

0.077

0.078

0.068

0.078

0.059

0.2830.195

0.49

0.27

0.36

4

0.16

3

0.11

3

0.1

0.10

20.

124

0.2

0.09

6

0.09

6

0.08

8

0.08

0.10

8

-

-

0.024

0.024

0.0260.0160.033

0.02

0.012

0.021

0.015

0.089

0.049

0.038

0.033

0.026

0.03

0.011

0.023

0.017

0.0360.058

-

-

0.058

0.011

0.013

0.005

0.061

0.122

0.057

0.173

0.106

0.17

0.044

0.044

0.047

0.188

0.057

0.052

0.157

0.056

0.036

0.05

0.079

0.048

0.054

0.045

-

0.017

0.0180.0170.016

0.069

0.173

0.117

0.552

0.16

0.17

0.049

0.078

0.116

0.178

0.081

0.089

0.195

0.127

0.138

0.094

0.07

0.045

0.087

0.064

0.066

0.067

0.064

0.055

0.02

0.0410.045

-

-

-

-

-

0.0960.031

0.0130.018

0.010.027

0.0080.028

0.053

0.021

0.01

0.037

0.029

0.019

0.035

0.024

0.026

0.023

0.016

0.227

0.069

0.06

0.021

0.036

0.026

0.054

0.023

0.021

0.028

0.072

0.03

0.031

0.032

0.035

0.021

0.023

0.013

0.01

0.005

0.0110.017

-

0.007

0.0190.0170.045

0.306

0.148

0.296

0.277

0.121

0.133

0.103

0.111

0.102

0.091

0.091

0.073

0.076

0.107

0.06

0.146

0.232

0.089

0.069

0.06

0.054

0.084

0.082

0.069

0.048

-

-

-

0.009

0.0150.0160.082

0.058

0.016

0.065

0.086

0.061

0.058

0.104

0.169

0.076

0.083

0.118

0.132

0.105

0.066

0.036

0.043

0.058

0.068

0.077

0.066

0.06

0.106

0.089

0.098

0.07

0.083

0.069

0.071

0.053

0.103

0.101

0.076

0.075

0.116

0.09

0.051

0.037

0.044

0.036

0.064

0.066

0.074

0.082

0.145

0.064

0.126

0.126

0.052

0.046

0.045

0.047

0.022

0.047

0.017

0.018

0.028

0.018

0.006

0.028

0.036

0.033

0.058

0.063

0.072

0.094

0.112

0.129

0.097

0.082

0.038

-

0.008

0.01

0.013

0.01

0.08

0.112

0.113

0.053

0.088

0.078

0.043

0.158

0.036

0.151

0.123

0.041

-

0.005

0.006

0.005

0.007

0.005

0.048

0.079

0.116

0.077

0.088

-

0.0060.0060.018

0.069

0.1

0.043

0.125

0.037

0.031

0.066

0.04

0.054

0.066

0.053

0.0140.01

0.0190.0190.182

0.036

0.128

0.079

0.038

0.019

0.051

0.281

0.032

0.05

0.07

0.028

0.016

0.052

0.031

0.025

0.005

0.004

0.018

0.053

0.025

0.077

0.03

0.01

0.052

0.038

-

-

0.01

0.051

0.027

0.015

0.065

0.099

0.101

0.079

0.089

0.065

0.089

0.138

0.091

0.057

0.056

0.081

0.075

0.063

0.056

0.053

0.068

0.084

0.051

0.047

0.006

0.01

0.0090.0060.006

0.012

0.059

0.048

0.066

0.125

0.139-

0.0030.004

0.028

0.028

0.145

0.084

0.251

0.166

0.182

0.059

0.135

0.12

0.083

0.118

0.204

0.255

0.096

0.142

0.158

0.087

0.082

-

-

0.002

0.002

0.052

0.138

0.067

0.112

0.091

0.473

0.154

0.085

0.058

-

-

-

0.107

0.114

0.065

0.053

0.053

--0.037

0.038

0.039

0.024

0.042

0.046

0.034

0.07

0.031

0.037

0.043

0.141

0.031

0.04

0.017

0.026

0.022

0.047

0.046

0.037

0.032

0.013

0.021

0.039

0.03

-

0.004

0.009

0.005

0.009

0.009

0.017

0.014

0.026

0.054

0.049

0.045

0.032

0.04

0.011

0.018

0.02

0.022

0.02

0.064

0.185

0.012

0.053

0.07

0.013

0.029

5890

00 E

589000 E

5891

00 E

589100 E

5892

00 E

589200 E

5893

00 E

589300 E

6619

800

N

6619800 N

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N

6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 30.48 00

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83

OVB

CGQM

FGQM

MQMP

SQMP

CQMP

SQMP

CGQM

SQMP

SQMP

CGQM-T

no samplOVB

CGQM

MQMP

SQMP

OVBCGQMCGQM-H

CGQM-T

CGQM

CGQM

SQMP

CGQM

CGQM

SQFP

FGQM

CGQM

CGQM

SQFP

CGQM

CGQM

SQMP

CGQM

SQMP

CGQM

FGQM

CGQM

SQMP

AD

-311AD-3

12

AD-3

59

AD

-360

AD

-363

AD

-364

AD

-366

AD

-367

KA-JM-2

KA

-114

KA

-115

KA

-127

KA

-128

KA

-24

KA

-25

KA

-6

KA

-7

KA

-8

PD

-232

-

-

0.007

0.016

0.01

0.009

0.008

0.005

0.077

0.012

0.009

0.038

0.018

0.071

0.04

0.044

0.203

0.056

0.073

0.122

0.035

0.052

0.095

0.24

0.224

0.036

0.054

0.044

0.032

0.035

0.039

0.051

0.03

0.038

0.031

0.061

0.034

0.08

0.054

0.063

0.059

0.053

0.089

0.095

0.045

0.037

0.022

0.03

0.03

0.032

0.063

0.0440.030.007

-

-

0.0080.011

0.0170.052

0.0070.02

0.0240.1190.11

0.0950.056

0.0560.073

0.0740.095

0.1170.189

0.0250.056

0.0330.053

0.0580.048

0.0390.032

0.0550.105

0.150.154

0.0880.03

0.0230.029

0.0460.025

0.040.031

0.0180.032

0.0150.045

0.0520.016

0.040.073

0.0340.055

0.0310.033

0.0760.039

0.1190.029

0.0370.127

0.0550.051

0.0430.038

0.0330.016

0.0180.028

0.0050.010.028

0.0210.024

0.009

0.0310.03

0.0510.074

0.0610.008

-0.004

0.0070.073

0.0420.058

0.0770.046

0.10.057

-

-

0.1570.070.1120.0730.0820.0530.0480.0470.112

-0.002

0.0040.0150.0370.0070.0040.0070.0370.0220.0970.106

0.028

0.01

0.015

0.007

0.005

0.004

0.004

0.007

0.007

0.058

0.031

0.023

0.027

0.042

0.081

0.119

0.1

0.086

0.03

0.055

0.17

0.11

0.025

0.051

0.027

0.034

0.067

0.05

0.03

0.017

0.021

0.020.035

0.022

0.0170.0120.048

0.078

0.043

0.05

0.151

0.036

0.078

0.107

0.056

0.046

0.156

0.138

0.04

0.064

0.091

0.082

0.071

0.041

0.182

0.057

0.03

0.082

0.032

0.008

-

0.007

0.0120.0170.039

0.045

0.099

0.085

0.059

0.014

0.089

0.044

0.031

0.038

0.042

0.032

0.069

0.106

0.062

0.094

0.041

0.036

0.031

0.069

0.051

0.0210.016

0.004

0.004

0.004

0.011

0.009

0.023

0.066

0.026

0.025

0.041

0.217

0.028

0.027

0.024

0.196

0.033

0.012

0.017

0.018

0.027

0.063

0.028

0.082

0.0780.0610.0320.015

-

-

0.01

0.014

0.049

0.015

0.181

0.023

0.031

0.039

0.036

0.042

0.023

0.033

0.042

0.075

0.077

0.063

0.084

0.056

0.041

0.032

0.048

0.044

0.049

0.038

0.043

0.076

0.036

0.035

-

-

-

0.006

0.005

0.005

0.005

0.004

0.006

0.005

0.017

0.017

0.005

0.008

0.008

0.006

0.005

0.006

0.006

0.006

0.009

0.008

0.006

0.006

0.007

0.012

0.013

0.011

0.012

0.013

0.101

0.014

0.054

0.017

-

0.0070.044

0.054

0.124

0.064

0.071

0.211

0.104

0.07

0.071

0.071

0.077

0.042

0.083

0.086

0.045

0.042

0.035

0.039

0.064

0.043

0.044

0.028

0.036

0.044

-

0.014

0.0140.024

0.024

0.117

0.061

0.08

0.078

0.071

0.077

0.078

0.04

0.048

0.088

0.075

0.055

0.057

0.08

0.093

0.106

0.062

0.059

0.058

0.068

0.102

0.0530.0270.027

0.018

0.019

0.018

0.021

0.008

0.023

0.0060.0060.008

0.006

0.018

0.024

0.027

0.024

0.029

0.026

0.097

0.079

0.036

0.085

0.04

0.087

0.029

0.041

0.104

0.075

0.061

0.061

0.054

0.0560.068

0.001

0.001

0.001

0.001

0.006

0.077

0.03

0.062

0.017

0.049

0.09

0.042

0.045

0.054

0.032

0.023

0.051

0.059

0.067

0.034

0.055

0.046

0.026

0.054

0.017

0.023

5890

00 E

589000 E

5891

00 E

589100 E

5892

00 E

589200 E

5893

00 E

589300 E

6619

800

N

6619800 N

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N

6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 30.48 WEST 4

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83

CGQM

SQMP

CQMP

BSLT

CQMP

CGQM-T

SQMP

CQMP

CQMPSQMPCQMPSQMP

CQMPSQMP

CQMP

SQMPSQMP

CGQM

SQMP

CGQM

FGQM

CGQM

SQMP

CGQM

SQMP

CGQM

SQMP

CGQM

SQFP

CGQM

SQFP

CGQMCGQM

SQMP

AD

-323

AD-3

60

AD-3

63

AD-3

66

AD-3

67

KA

-104

KA

-125

KA

-126KA

-27

KA

-28

KA

-29

KA

-30

KA

-31

PD

-224

-

0.002

0.008

0.005

0.002

0.021

0.014

0.017

0.013

0.006

0.016

0.135

0.065

0.055

0.052

0.042

0.079

0.064

0.054

0.028

0.026

0.029

0.011

0.013

0.047

0.028

0.047

0.046

0.033

0.021

0.034

0.023

0.035

0.049

0.057

0.033

0.0170.001

0.0680.035

0.030.045

0.0350.0210.0130.019

0.0560.053

0.0560.0450.055

0.0370.0450.040.054

0.0330.0270.0630.0310.0120.0110.0310.021

0.0480.0310.0490.0250.0280.0280.0110.0210.0460.0220.0180.1420.0190.02

0.0450.0290.026

0.0320.0430.0450.020.0270.0160.0360.0320.0360.034

-

0.059

0.032

0.063

0.123

0.063

0.053

0.079

0.132

0.328

0.058

0.043

0.028

0.04

0.041

0.06

0.05

0.026

0.041

0.053

0.039

0.021

0.0210.029

0.02

0.01

0.014

0.025

0.016

0.022

0.028

0.022

0.059

0.038

0.034

0.027

0.047

0.045

0.035

0.073

0.04

0.054

0.021

0.042

0.082

0.097

0.045

0.058

0.031

0.062

0.06

0.0530.0130.025

0.024

0.02

-

-

0.046

0.037

0.022

0.008

0.007

0.008

0.01

0.068

0.04

0.028

0.015

0.02

0.024

0.02

0.044

0.04

0.105

0.056

0.022

0.016

0.031

0.042

0.03

0.102

0.053

0.0130.0130.042

0.036

0.012

0.029

0.033

0.061

0.037

0.063

0.153

0.246

0.113

0.04

0.06

0.064

0.081

0.178

0.112

0.091

0.06

0.08

0.078

0.05

0.037

0.07

0.033

0.010.010.069

0.029

0.016

0.034

0.097

0.242

0.133

0.088

0.129

0.072

0.074

0.112

0.068

0.048

0.032

0.033

0.043

0.024

0.035

0.043

0.044

0.028

0.052

0.046

0.03

0.032

0.03

0.026

0.005

0.006

0.005

0.006

0.016

0.014

0.042

0.028

0.009

0.068

0.046

0.056

0.033

0.03

0.033

0.029

0.03

0.024

0.028

0.025

0.02

0.013

0.022

0.023

0.034

-

0.004

0.005

0.004

0.004

0.005

0.005

0.006

0.023

0.03

0.028

0.044

0.039

0.069

0.12

0.068

0.029

0.017

0.045

0.034

0.026

0.036

0.03

0.049

0.035

0.029

0.03

0.022

0.043

0.069

0.061

0.0530.0360.035

0.034

0.032

0.021

-

-

0.005

0.005

0.005

0.004

0.005

0.005

0.006

0.007

0.011

0.008

0.01

0.007

0.007

0.01

0.01

0.011

0.012

0.009

0.012

0.014

0.014

0.017

0.0110.012

--

0.061

0.09

0.066

0.068

0.12

0.076

0.057

0.019

0.051

0.098

0.057

0.132

0.061

0.041

0.023

0.027

0.024

0.041

0.04

5890

00 E

589000 E

5891

00 E

589100 E58

9200

E

589200 E

5893

00 E

589300 E

6619

700

N

6619700 N

6619

800

N

6619800 N

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N

6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 60.96 WEST 8

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83

CGQM

FGQM

CGQM

FGQM

CGQM

MQMP

CQFP

CGQM

MFP

SQMP

CGQM

FGQM

CGQM

CQFP

CGQM

Casing

CGQM

FGQM

CGQM

FGQM

SQMP

CGQM

MFP

CGQM

SQMP

CQMP

SQMP

CQMPSQMPCQMP

AD

-324

AD

-335

AD

-336

AD-370

PD

-253

0.009

0.005

0.002

0.011

0.008

0.02

0.004

0.012

0.01

0.008

0.046

0.006

0.013

0.078

0.036

0.03

0.027

0.028

0.039

0.016

0.013

0.043

0.035

0.034

0.052

0.073

0.047

0.053

0.035

0.068

0.041

0.128

0.077

0.119

0.048

0.066

0.035

0.012

0.012

0.021

0.016

0.011

0.006

0.016

0.023

0.008

0.01

0.01

0.008

-

-

0.001

0.002

0.002

0.009

0.015

0.006

0.024

0.027

0.044

0.023

0.038

0.023

0.025

0.027

0.043

0.034

0.023

0.0290.0160.108

0.064

0.085

0.025

0.052

0.038

0.02

0.056

0.021

0.022

0.047

0.012

0.063

0.047

0.025

0.024

0.015

0.004

0.007

0.007

0.001

0.001

0.037

0.019

0.022

0.0170.028

0.067

0.038

0.037

0.095

0.099

0.073

0.05

0.064

0.05

0.054

0.036

0.146

0.052

0.048

0.03

0.089

0.038

0.034

0.025

0.024

0.025

0.0190.0190.017

0.014

0.015

0.008

0.013

0.01

0.006

0.005

0.006

0.005

0.003

0.002

0.007

0.003

0.016

0.008

0.004

0.002

0.017

0.008

0.01

0.002

0.111

0.009

0.025

0.041

0.026

0.019

0.027

0.023

0.024

0.014

0.026

0.025

0.02

0.01

0.023

0.036

0.032

0.196

0.162

0.008

0.043

0.027

0.02

0.026

0.04

0.015

0.099

0.199

0.062

0.015

0.022

0.036

0.054

0.061

0.056

0.034

0.031

0.143

0.08

0.03

0.038

0.145

0.025

0.095

0.152

0.059

0.031

0.019

0.015

0.055

0.043

0.017

0.013

0.012

0.008

0.018

0.012

0.022

0.002

-

0.015

0.011

0.019

0.017

0.011

0.009

0.020.0170.094

0.032

0.028

0.077

0.079

0.12

0.047

0.062

0.062

0.08

0.033

0.029

0.020.0180.03

0.015

0.02

0.014

0.018

0.011

0.01

0.01

0.007

0.008

0.029

5890

00 E

589000 E

5891

00 E

589100 E

5892

00 E

589200 E

5893

00 E

589300 E

6619

700

N

6619700 N

6619

800

N

6619800 N

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N

6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 60.96 WEST 18

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83

CGQM

SQFP

CQFP

CGQM

SQFPCGQM

CGQM

CQFP

CGQM

MFP

CGQM

MFPFGQM

MFP

FGQM

CGQM

OVB

CGQM-T

CQFP

CGQM

CGQM CGQM

CQFP

FGQM

CQFP

CGQM

CQFP

CGQM

CGQM

CQFPCGQM

CQFP

FGQMCQFP

CGQM

CQFP

CGQM

AD-310

AD

-328

AD

-351

KA

-100

KA

-101 KA

-102

PD

-259

PD-2

63

0.0490.0110.0110.0070.020.0080.0030.0210.0180.0270.0510.0630.0050.0350.4510.0190.0040.0150.0120.1180.0080.0120.0540.0430.0260.0280.0720.0250.0530.0310.0210.0180.0380.0320.07

0.050.2780.2840.1050.1850.1130.0840.0880.0930.07

0.0940.0540.0560.2070.0230.0670.019

-

-

0.004

0.003

0.001

0.005

0.001

0.006

0.024

0.007

0.004

0.112

0.011

0.005

0.035

0.037

0.027

0.031

0.035

0.021

0.023

0.033

0.025

0.035

0.065

0.034

0.039

0.046

0.033

0.018

0.01

0.016

0.029

0.066

0.01

0.01

0.006

0.008

0.012

0.008

0.013

0.019

2.97

0.002

0.002

-

-

0.001

0.007

0.007

0.001

0.004

0.0080.0890.009

0.005

0.012

0.025

-

-

0.003

0.007

0.005

0.01

0.0150.010.074

0.044

0.013

0.019

0.018

0.055

0.042

0.096

0.203

0.084

0.047

0.049

0.044

0.032

0.032

0.057

0.028

0.023

0.033

0.024

0.038

0.039

0.0450.018

-

-

-

0.004

0.002

0.002

0.032

0.024

0.014

0.01

0.015

0.008

0.013

0.008

0.007

0.023

0.027

0.040.0160.026

0.177

0.033

0.016

0.044

0.009

0.016

0.102

0.085

0.023

0.07

-

0.008

0.011

0.007

0.014

0.01

0.015

0.013

0.01

0.016

0.006

0.011

0.006

0.02

0.035

0.042

0.024

0.028

0.022

0.032

0.029

0.039

0.031

0.024

0.043

0.029

0.04

0.037

0.038

0.122

0.1110.047

-

0.004

0.004

0.004

0.007

0.01

0.034

0.019

0.022

0.006

0.016

0.02

0.038

0.048

0.098

0.082

0.107

0.11

0.005

0.041

0.035

0.017

0.01

0.026

0.035

0.016

0.0260.0150.072

0.018

0.041

0.438

0.043

0.023

0.032

0.029

0.036

0.026

0.051

0.07

0.098

0.040.047

-

0.0190.0110.0050.0070.0330.0090.0050.010.06

0.0370.0660.0080.0130.3850.0840.0260.0640.0160.0160.0360.0260.0340.0150.0150.0090.0220.050.0370.0370.0930.0490.0340.0590.0360.0310.0370.0710.0690.0920.0620.0470.0920.1190.0690.2170.1460.0610.0640.0330.1020.0950.08

0.0350.0510.0650.1390.1550.0680.078

5889

00 E

588900 E

5890

00 E

589000 E

5891

00 E

589100 E

5892

00 E

589200 E

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

6620

500

N

6620500 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 60.96 WEST 26

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83

CGQM

MGQM

CGQM

FGQM

CGQM

FGQM

CQMPMQFP

MEQM

AD

-333

AD-351

-

-

0.001

-

0.001

0.001

0.004

0.002

0.011

0.007

0.005

0.006

0.017

0.007

0.005

0.005

0.011

0.007

0.015

0.011

0.011

0.011

0.023

0.0130.0060.067

0.009

0.027

0.016

0.044

0.055

0.043

0.048

0.032

0.027

0.053

0.122

0.078

0.071

0.031

0.063

0.169

0.135

0.054

0.039

0.059

0.093

0.126

0.037

0.033

0.0240.057

0.001

0.001

0.001

0.0010.001

5890

00 E

589000 E

5891

00 E

589100 E

5892

00 E

589200 E

5893

00 E

589300 E

6619

700

N

6619700 N

6619

800

N

6619800 N

6619

900

N

6619900 N

6620

000

N

6620000 N

6620

100

N

6620100 N

6620

200

N

6620200 N

6620

300

N

6620300 N

6620

400

N

6620400 N

1100 Elev1100 Elev

1200 Elev1200 Elev

1300 Elev1300 Elev

1400 Elev1400 Elev

1500 Elev1500 Elev

1600 Elev1600 Elev

ROCK 2

ROCK 3

ROCK 4

ZONE 6

ZONE 7

DRILLHOLELITHOLOGY

-

BSLT

CGQM

CGQM-H

CGQM-T

CQFP

CQMP

MGQM

FGQM

MEQM

MFP

MFP3

MQMP

OVB

SQFP

SQMP

ROCK TYPE &MINERALIZED

ZONES

Adanac Moly Corporation

Ruby Creek Property

0 5 10 15 20 25 30Scale 1:1500

Section Width: 60.96 WEST 32

Drawn By: KAH Checked By: PGP 04 Jun 07

NOTE: - Column on left side of hole shows Drillhole Lithology - Column on right side of hole shows % MO - % MO is composited over 6 m intervals, -1 represents missing - Datum is NAD83