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Nickel Offsets Property, Sudbury

Property Holdings Along the Foy Offset Dike, Foy & Bowell Townships, Sudbury Mining Division view

NICKEL OFFSETS PROPERTY

United Reef holds a 100% interest in the property. In March 2008, URSA Major Minerals Incorporated (TSX-UMJ) was granted an option, as amended, to earn a 70% interest in the property by making $1.25 million of exploration expenditures over 4 years, cash payments of $100,000 and issuing 100,000 common shares of URSA Major to United Reef.

URSA Major completed an initial drilling and borehole EM program on the property in the fall of 2009 which identified new massive sulphide targets in close proximity to the existing mine workings. URSA Major mobilized a follow up drilling and borehole EM program in the fall of 2010 and advised that they had made cumulative expenditures of $500,000 on the property by October 28, 2010. Highlights from this program include an intersection of 2.89 metres of nickel rich massive sulphides (2.90% nickel, 0.97% copper, 0.16% cobalt, 0.94 g/t platinum, 1.28 g/t palladium, and 0.11 g/t gold) and 2 meters of platinum group metal mineralization (3.04 g/t platinum, 2.00 g/t palladium, 0.82 g/t gold, with 0.07% nickel and 0.37% copper) in disseminated sulphides in the footwall of the nickel-rich massive sulphides. URSA Major has disclosed their intention to mobilize a follow-up drilling program on the property during 2011.

The property consists of 12 patented claims (358.5 acres) and 5 unpatented mining claims (525 acres) within Foy Township, Ontario, 40 km NNW of Sudbury. The claims straddle a 2.25 km strike length of the Foy Offset, the largest radial offset dike emanating from the Sudbury Igneous Complex. The unpatented ground covers the Foy Offset dike to a projected depth of 2,000 metres.

The property includes the past-producing Nickel Offsets Mine (1943–1957) and historic records indicate extensions of mined ore lenses may remain in place. Located in the Sudbury mining camp which has historically produced in excess of 16 billion lbs. Ni, 15 billion lbs. Cu, 85 M oz Ag, 17 M oz Pt, and 3 M oz Au.

Nickel Offsets Mine, Longitudinal Section Compilationview

NICKEL OFFSETS MINE

The Sudbury region is dominated by a large elliptical depression, believed to be funnel-shaped, known as the Sudbury Structure. Approximately 60 km long by 30 km wide, with its long axis trending east-northeast, the Sudbury Structure lies at the junction of three unique geological-structural provinces: the Archean Superior Province, the Early-Proterozoic Southern Province, and the Middle-Proterozoic Grenville Front Tectonic Zone. More specifically, the Sudbury Structure straddles the contact between the granitic & gneissic basement rocks of Superior Province to the north and the Huronian supracrustal metasedimentary and metavolcanic rocks of the Southern Province to the south. The Grenville Front Tectonic Zone that truncates the two older provinces lies approximately 15 km southeast.

The Sudbury Structure, unique in terms of the great size of its mineral deposits and its complex geology, constitutes the largest known concentrations of nickel-copper-PGE bearing sulphide minerals in the world. Due to its economic importance, the structure is one of the most intensively studied and documented regions of the Canadian Shield.

Geology of the Sudbury Structure

Stratigraphically, from top to bottom, the Sudbury Structure consists of the Whitewater Group of sediments which infill a central depression, the underlying Sudbury Igneous Complex (“SIC”), and brecciated footwall rocks surrounding the SIC.

The Whitewater Group

Infilling the central depression of the Sudbury Structure are the Whitewater Group sediments that consist of, stratigraphically from top to bottom, the Chelmsford Formation, a carbonaceous and arenaceous greywacke that is interpreted to be a proximal turbidite; the Onwatin Formation, a 300-metre thick layer of manganese-rich slate; and the Onaping Formation, a 2-km thick volcaniclastic/breccia sequence. No rocks which can be correlated with the Whitewater Group have been positively identified outside the Sudbury Structure and it has not been established with any certainty as to whether or not the Whitewater Group represents older supracrustal rocks intruded by the SIC or is syn- or post-SIC age.

The Sudbury Igneous Complex

Underlying the Whitewater Group is the Sudbury Igneous Complex (“SIC”). Formerly known as the “Nickel-Bearing Irruptive” or “Sudbury Nickel Irruptive”, the SIC consists of a 500 to 2,500 metre thick lower zone of augite-bearing norite; a thin middle layer consisting of norite grading upwards into quartz gabbro otherwise known as the Transition Zone; and a 1 to 2,500 metre thick upper zone of micropegmatite/granophyre. At the base of the augite-bearing norite is a discontinuous zone of inclusion and sulphide-rich norite-gabbro commonly known as the Contact Sublayer (“Sublayer”). The Sublayer occurs as gently dipping sheets or irregular lenses along the base of the SIC or as small bodies in radial depressions or troughs in the base of the SIC called embayments, and as steeply dipping dikes called offsets (in reference to their having been offset by late faulting) which intrude into the adjacent Archean and Proterozoic footwall. The Sublayer is typically gabbroic in the base of the SIC and in the embayments, and typically quartz-diorite in the offset dikes. All nickel-copper-PGE deposits of the Sudbury Structure are contained within the Sublayer and related structures such as the offset dikes.

Two varieties of offset dikes are recognized: radial and concentric. Radial dikes appear to stem directly from the Sublayer and into the footwall rocks in a radial pattern with respect to the SIC. Concentric dikes are thought to be related to ring faults and may be connected to the Sublayer at depth or represent accumulations of melt rock associated with pseudo-tachylyte formation.

Pseudo-tachylyte is composed of mineral and rock fragments derived predominantly from country rock set within a typically dark microcrystalline, almost glassy, matrix that is believed to be the result of frictional melting due to high degrees of strain. Geographically, the SIC is divided into the North Range, South Range and East Range. Dips on the North Range are moderate, averaging 35-40° to the south, while dips on the South Range average 65° to the north, sometimes locally overturned with south dips. Dips on the East Range are steep to the west. Two systems of faulting are recognized. The first trends east-west (e.g. Cameron Creek Fault and Airport Fault), dips to the south and appears to have a vertical offset of at least 5 km. The second fault system trends north-northwest, dips steeply west or is vertical.

Footwall Rocks

Footwall rocks to the north of the SIC consist of the Archean basement granitic and mafic igneous rocks of the Superior Province and the granulite-facies rocks of the Levack gneiss complex on the periphery of the North Range. Immediately adjacent to and underlying the Sublayer within the North and East Ranges, the footwall rocks are highly brecciated. This Footwall Breccia (also known as Late Granite Breccia or Anatexite) is a xenolith-bearing metamorphic to igneous-textured breccia and is characterized by Ni-Cu-PGE sulphide mineralization that has apparently migrated outward from the Sublayer.

Footwall rocks to the south consist of the metavolcanic and metasedimentary rocks of the Huronian Supergroup. These rocks lie unconformably over the migmatitic Archean basement which is exposed on the north-western side of the Sudbury Structure. The Huronian has undergone a higher degree of metamorphism than is seen in rocks of the Whitewater Group and carries a strong penetrative foliation as a result of some compressive strain. A number of basic and acid intrusions such as the Creighton and Murray Plutons intrude the sediments along the southern margin of the Sudbury Structure.

To the south of the plutons lies the South Range Breccia Belt (“SRBB”), the largest known pseudo-tachylyte body in the world. The SRBB forms an arc-shaped, dike-like body approximately 45 km in length and between 10 and 2,000 metres wide. Near its eastern end the SRBB hosts the Frood-Stobie deposit, the largest nickel-copper-PGE deposit in the world.

Nickel Offsets Mine - Long section and Plan with 2005 Drill Hole Traces view

PROPERTY GEOLOGY

The Nickel Offsets Property covers a 2.5 km strike length of the Foy Offset Dike and a projected depth of approximately 2,000 m. The Foy Offset Dike is the largest of all known radial offset dikes emanating from the Sublayer of the SIC and has been traced for approximately 28 km from the North Range of the SIC into the surrounding Archean granitic footwall. Striking west-northwest, the Foy Offset Dike is reasonably well exposed through Bowell and Foy townships as far as the Nickel Offsets Mine. Northwest of the mine, the extension of the dike is a matter of interpretation but it is generally accepted that the dike extends a short distance into Tyrone Township after being laterally displaced northwards by the Sandcherry Creek Fault. Dip is steep, averaging 75-80° to the north. The down-dip extent and continuity of the dike appears to be good with diamond drilling intersecting the dike at depths of at least 750 metres in the area of the Nickel Offsets Mine. For comparison the Copper Cliff Offset dike extends to depths of 1,500 metres.