Technical Report on the Taurus Project by Orequest Consultants Ltd. dated January 31, 2005
The Taurus Gold Project is located in the Cassiar gold camp about six kilometres east of the Cassiar town site in northern British Columbia. Bonanza owns 100 percent of the 46 claims on which are located the past producing Sable, Plaza and Taurus mines; and the 88 Hill, 88 West and Highway Zones of the recently discovered disseminated gold deposit. Ten claims in the area of the old mines, which are east of the main Taurus Gold Project mineralization, are subject to a 2.5 percent Net Smelter Return royalty. The property is directly on paved Highway 37. Mine and drilling roads access the mineralized area and there are excellent service facilities nearby. The area is on the Arctic slope with elevations ranging from 1,000 to 2,150 metres. There are no extraordinary environmental problems.
Although gold has been mined in the Cassiar area for 125 years, the potential for a disseminated deposit did not come to light until 1994. At that time, Taurus geologists discovered gold dispersed in the country rocks well away from the high-grade quartz veins traditionally mined in the Cassiar camp. Impressed with the potential, Cyprus Canada Inc signed an agreement to explore the Taurus Gold Project properties for suitable open-pit, bulk-tonnage mineralization.
After overseeing a year's exploration work, including geochemistry, geophysics, geology and 83 drill holes (about 13,500 metres of drilling), Cyprus initially calculated an "inferred, geological, uncut and undiluted resource" of 28.4 million tonnes grading 1.36 grams of gold per tonne. From context, it cannot be determined if this "inferred, geological, uncut and undiluted resource" is equivalent to a NI 43-101-compliant inferred resource. This information is presented only in a historical context and should not be relied upon as a resource by the public.
Cyprus withdrew from gold exploration and from Canada in 1997, and the property reverted to International Taurus Resources Inc (Taurus recently merged with American Bonanza Gold Mining Corp to form American Bonanza Gold Corp). International Taurus continued exploration, drilling 47 holes (5,141 metres of drilling). This work confirmed grades and established mineralization continuity over 800 metres along strike in the 88 Hill and 88 West zones
Geology and Gold Resources
The dominant geological feature of the Taurus Project region is a flat-lying pile of thrust-fault sheets consisting of ophiolite and island-arc rocks. Thrust faulting has created intense fracturing, which provided access to the gold-bearing mineralizing fluids. Rocks in the immediate Taurus Project area are mainly Mississippian to Triassic basalt, argillite, chert and mudstone. The basalt is by far the most important as it both dominates the stratigraphy of the area and it is the host rock for the gold deposits. Regional metamorphism has converted the original basalt to a greenschist.
The Taurus Project gold deposit is centred on 88 Hill, a low rise in the valley bottom bounded on the north by the Cassiar highway. Six geographic zones make up the area of the deposit. These are 88 Hill, 88 West, Highway, Plaza mine, Sable mine and Taurus mine. The best-defined portion of the deposit is in the 88 Hill zone. The mineralization consists of a gold-quartz-pyrite association. This occurs at the surface and extends down through about 100 metres of basalt. The configuration of the 88 Hill mineralization is such that it could be placed in production, as a startup operation for the entire deposit, and economically bulk mined with open-pit methods.
The Next Stage of Development
The project is currently being evaluated to determine the economics of the resource at current gold prices. Further development will depend on the results of this study.