Copper Canyon | Project Copper Canyon Abo

Copper Canyon
Project | CU, AU, AG

DESCRIPTION

The Project

The Copper Canyon property is a multi-million ounce copper-silver-gold deposit located approximately 150 kilometers northeast of the tidewater port of Stewart, British Columbia and 75 kilometers northwest of Barrick Gold’s Eskay Creek gold-silver mine that produced 350,000 ounces of gold annually for more than 20 years.

The Galore Creek/Copper Canyon project overlies one of the largest and highest-grade alkalic intrusive-related gold-silver-copper deposits in North America.

Copper Canyon Resources controls 40% of the Copper Canyon property. NovaGold/Teck Cominco have earned a 60% interest in the Copper Canyon project, by completing C$3 million in exploration expenditures, issuing a total of 296,000 of NG shares and making property payments totalling C$250,000.

History

The Copper Canyon property history dates back to August, 1956 when American Metal Co. Ltd (which through several corporate restructurings became Amax and finally Canamax Resources) staked the original claims overlying prominent gossans in the area. The claims remained in good standing continuously until August, 2001, when they were forfeited during the darkest days of BC’s exploration downturn. The claims were immediately acquired by Bernie Kreft, of Whitehorse - the first time this opportunity had arisen since 1956! Eagle Plains Resources Ltd. subsequently optioned the property from Kreft, acquiring a 100% interest.

In June 2006, the shareholders of Eagle Plains approved a plan to reorganize their mineral property assets in an effort to maximize their value. Under the terms of the arrangement, 100% interest in three of Eagle Plains’ projects: Copper Canyon, Severance and Abo (Harrison) Gold, were transferred into a newly formed company, Copper Canyon Resources Ltd. and the new shares were issued to Eagle Plains investors on a one-for-one basis.

2010 Inferred Resource Calculation

In May 2010 Moose Mountain Technical Services, an independent firm, calculated an updated inferred resource at Copper Canyon which included data from the 2005 and 2007 drilling (16 holes) and also included data used in the previous resource calculation (21 holes). The new study was in large part a confirmation of work completed by NovaGold geologists who have completed significant structural and geological work on the deposit, resulting in a greatly improved understanding of the geometry and mineralizing controls of the deposit.

Using a 0.35% copper equivalent* (CuEq) cutoff, the updated resource calculation at the Copper Canyon property reports the estimated, unconstrained inferred mineral resource of 152.6 millions tonnes grading 0.31% Cu, 0.515 g/t Au and 6.32 g/t Ag with an overall CuEq of 0.687% (resulting in 1.03B lbs Cu, 2.53M oz Au and 30.98M oz Ag in contained metals). This resource was estimated using ordinary kriging with copper equivalent cut off.

* The copper equivalent grade was calculated as follows: CuEq = Recoverable Revenue / 2204.62 * 100 / 1.55. Where: CuEq = Copper equivalent grade; Recoverable Reserves = Revenue in US dollars for recoverable copper, recoverable gold and recoverable silver using metal prices of US$1.55/lb, US$650/oz, and US$11/oz for copper, gold, and silver, respectively; Cu Recovery = 100%

The Resource Area

The resource is defined over a broad area of precious metal rich mineralization at least 700 meters by 400 meters which is open to expansion in 3 directions including depth. The mineralization begins at surface, continuing to as much as 300 meters depth and occurs as a roughly 100+ meter thick zone of disseminated chalcopyrite and pyrite hosted within an intrusive porphyry complex. Prior to 2007 work, the area covered by the existing drill holes represented less than 0.5% of the entire property area.

2010 Exploration and Drilling Program

An exploration and drill program is planned for Copper Canyon during the summer of 2010. The objective of the drilling program is to test the mineralization both to depth and along strike with the intention of enhancing the size of the inferred resource and to further understand the deposit geology. A ground based exploration program is planned to evaluate the potential for mineralization outside of the known deposit area. The intent of this program is to identify future drill targets.

2007 Drilling

During the 2007 season, NovaGold/Teck Cominco completed a 16,000’ (4,940m), 12-hole diamond drilling program on the Copper Canyon Property. The 2007 program had multiple objectives, including resource expansion and the testing of additional geochemical and geophysical targets on the property. A number of holes were targeted beneath and beyond the existing boundaries of the current inferred resource.

All holes from the 2007 program intersected significant mineralization:

- Hole CC07-0033 was drilled to a total depth of 2,076 ft (633 m), testing over 250 m beneath historical drill-hole CC90-2, the highest-grade hole in the Galore District, which intersected 888 ft (270 m) grading 1.92 g/tonne Au, 22.28 g/t Ag and 1.05% Cu.

- Follow-up drilling was also completed on hole CC05-030 (drilled in late 2005), which intersected 2.5 m grading 50.6 g/t Au (1.5 oz/ton).

Highlights:

-	DDH CC07-033 returns 129.0m grading 0.89% copper-equivalent from 76.0m to 205.0m and 158.8 m grading 1.13% copper-equivalent from 438.2m to 597.0m
-	DDH CC07-34 returns 118.0 m grading 0.99% copper- equivalent from 4.60 to 122.60m
-	DDH CC07-36 returns high-grade gold mineralization of 31.9 g/t Au over 2.5 m from 183.5m to 186.0m and 26.8g/t Au over 2.7m from 211.8m to 214.5m (true thicknesses undetermined)
-	DDH CC07-44 returns 181.0 m grading 0.69% copper equivalent from 26.5m to 207.5m

Results of the 2007 drill program can be viewed here: Copper Canyon News Release - 2007 Drill Results

A compilation map outlining drill-hole locations can be found here: Copper Canyon Drill-hole Location Map

2005 Inferred Resource

In 2004, option partner NovaGold Resources conducted an 8 hole drill program in the area of an exposed gossan and where previous operators had drilled 14 holes in 1990. Highlights of the 1990 drilling include the best hole drilled in the Galore Creek district:

- CC1990-02 which intersected 270.8m (898’) grading 1.92 g/tonne Au, 22.28 g/tonne Ag and 1.05% Cu.

Using data from the 1990 program along with the results of the 2004 drilling, independent engineering firm Hatch Ltd. of Vancouver, B.C. calculated an inferred resource. On January 10th, 2005 NovaGold announced that the Copper Canyon property contains an inferred resource of over 2.86 million ounces of gold, 37.9 million ounces of silver and 1.16 billion pounds of copper at a 0.35% copper equivalent cut-off grade (CuEq).

Corporate Outlook

The Galore Creek property contains one of the world’s largest undeveloped copper and gold resources and CPY management believes that the Copper Canyon project holds considerable strategic value to the development of the Galore Creek area. With long-term demand for copper and gold projected to remain strong, British Columbia remains a good place to invest. The Company is committed to stand by the merits of this important asset and will work with its partners to develop viable alternatives to the current project.

Updated:June 1, 2010