Mining Projects - Fabie Bay and Magusi River

Fabie Bay and Magusi History

Fabie Bay
Noranda test mined and milled a total of 103,000 tonnes grading 2.64% Cu in 1970's

Magusi River
Inferred resources 43-101
1.2 mm T 7% Zn
886,000 tonnes 3.3% Cu

Globex Mining Enterprises acquired both deposits in 2002.

In 2006 First Metals purchased both claims from Globex for a cash consideration of $1M, a 10% ownership in First Metals, a 2% Net Metals Royalty, and a 10% Net Profit Interest (after recovery of $10M in project capital).

Fabie Bay and Magusi Deposits (Noranda Camp, Quebec)

3-D Projection

. Estimated $15M in development and exploration
. Projected 7 year production

THE FABIE BAY PROJECT

The Fabie Bay Deposit is a classic VMS deposit (Volcanic Massive Sulphide) where an inferred mineral resource of 672,800 tonnes, grading 2.77% copper has been delineated from surface to approximately 500 feet below surface. Extensive development of the deposit (approximately 90%) has been completed by previous operators, including a ramp capable of being used for production, to the 450 foot level. A 100,000 tonne bulk sample has been extracted from surface and successfully mill tested. Recoveries were good and there are no known metallurgical impediments.

A two phase program has been proposed to develop this project:

Phase I:
a) complete exploration permitting: the Company has retained the professional consulting services of Golder Associates to assist in the process of obtaining the various permits required to advance the exploration and development of the Fabie project;
b) carry out ITH (in the hole) drilling from surface in a 3 meter by 3 meter pattern;
c) dewater and rehabilitate the ramp and ventilation raise in order to allow for underground access for exploration and development;
d) undercut the mineralization and develop the deposit to the 250 meter level from underground;
e) survey the ITH holes and establish proven and probable reserves to 43-101 standards;

Phase II:

The Company will concurrently pursue measures to advance the project towards production on an expedited basis by taking the necessary steps to obtain a production permit, including:
a) negotiating a Closure Plan and posting the requisite Bond;
b) developing a custom milling contract;
c) ITH blast first stope from the 250 foot level to surface;
d) develop second ITH stope from the 300 foot level to the bottom of the lens at the 500 foot level.

Click here to view 3D animation of the Fabie Bay Deposit. (Windows Media Player Format, 2MB size)

THE MAGUSI RIVER PROJECT

The Magusi River Deposit is rich in zinc and copper with significant credits for gold and silver. It is located 1.2 kilometers west of the Fabie Bay Deposit and on the same horizon. The resource is contained in 2 distinct lenses. The zinc rich lens hosts an estimated inferred resource of 1,230,000 tonnes of 7.1% zinc, 0.4% copper, 1.9 g/t of gold and 29 g/t of silver. The copper rich lens contains an inferred resource of 838,860 tonnes of 0.3% zinc, 3.3% copper, O.2 g/t gold and 39 g/t. In aggregate, on a contained, in the ground basis, this equates to 197 million pounds of zinc, 71 million pounds of copper, 80,000 ounces of gold and 2.2 million ounces of silver. The Magusi deposit is categorised as being at an advanced exploration stage. Additional work is required and proposed to advance the Project on an expedited basis. The work includes:

a) 2,000 meters of delineation drilling;
b) rapid deep I.P. (inverse polarization) geophysical surveys;
c) detailed mine planning.

Expansion of the deposit through further exploration, both along strike and at depth will be systematically pursued.

EXPLORATION POTENTIAL

The First Metals properties host two known VMS deposits. It is quite common for such Volcanic Massive Sulphide deposits to occur in clusters. The Company has an extensive property package that could contain additional deposits. In addition, there remains potential to extend the existing deposits along strike and at depth. The Company intends to carry out systematic exploration programs to test these targets.

Resource Estimates*

Contained metal: 41 Million lbs Copper

Contained metal: 71 Million lbs Copper, 197 Million lbs Zinc, 80,000 oz Gold, and 2.2 Million oz Silver

* Source: Micon 43-101 Reports