The Ulu Property (“Ulu”) covers an area of 947 hectares, located approximately 523 kilometres (“km”) north of Yellowknife NT within the Kitikmeot Settlement Area of Nunavut at longitude 110° 58’W and latitude 66° 54’N. The hamlet of Kugluktuk is approximately 210 km to the northwest, and Cambridge Bay, approximately 340 km to the northeast. Ulu consists of a renewable 21-year Crown mining lease (No: NL3563) and has an expiry date of Nov 18, 2038.

Ulu is accessible by fixed-wing aircraft from Yellowknife. A 1,200 metre by 32 metre gravel airstrip is situated 3.5 km south of the Ulu camp. Float-equipped aircraft can land on West Lake, located approximately 1 km from the camp. Additionally, Ulu may be accessed by a seasonal ice road from the Lupin mine.

Camp infrastructure at Ulu is comprised of offices, mine dry, kitchen facilities, telecommunications equipment, sewage treatment, mine shop and housing for 60 persons with supporting electric generators, a water filtration system and fuel storage tanks.

The Ulu Property hosts an advanced stage gold project, which between 1989 and 2006 saw significant exploration and development. Past explorers include BHP Billiton (1989 to 1993), Echo Bay Mines Ltd. (1995 to 2002), and Wolfden Resources Inc. and successor companies (2004 to 2011). A 1.7 km long underground decline and associated development exits, and over 400 diamond drill holes that produced 97,820 metres of core pre-2019. Bulk sampling by Echo Bay produced a stockpile containing an estimated 2,227 tonnes of material grading 13.8 grams per tonne (“g/t”) for an estimated 988 contained ounces of gold.

Supplementing the exploration data, metallurgical test returned gold recoveries of greater than 90% by applying gravity, flotation, and cyanidation.

Geological Summary

The main deposit, called the Flood Zone, is a northwest-trending, shear hosted anastomosing vein/alteration system that occurs proximal to a basalt-metagreywacke contact at the core of the Ulu anticline. The deposit is steeply dipping to the southwest and has been traced for over 400 metres on surface. The current Measured and Indicated Resource on the Flood Zone lies between the surface and a vertical depth of 525 metres. The deepest significant Flood Zone drill intersection assayed 14.9 g/t gold over 7.7 metres at a depth of 610 metres below surface.

Technical Report on the Ulu Property

In April 14, 2015, the Company reported that Giroux Consultants Ltd. (Gary Giroux), Buena Tierra Developments Ltd. (Paul Cowley) and North Face Software Ltd. (Bob Singh) had completed an independent Technical Report entitled “Technical Report on the Ulu Gold Property, Nunavut, Canada.” The Technical Report was prepared in accordance with National Instrument 43-101 Standards of Disclosure for Mineral Projects and contains a mineral resource estimate for the Flood Zone, the principal occurrence, and only developed gold zone within the Ulu Property. In addition, a small Inferred Resource was estimated for the satellite Gnu Zone. This mineral resource estimate replaced the historic 2011 mineral resource estimate for the Flood Zone gold deposit contained in the 2011 technical report prepared for Elgin Mining Inc.

The new mineral resource estimate includes increased tonnage and contained ounces, when compared to previous resource estimates. The primary reasons for these increases were the reinterpretation of the vein system and changes in prevailing economic considerations including gold price, exchange rates and the positive impact of the proximity to the Lupin Gold Mine. The vein system reinterpretation was the result of corrections to the Ulu database and shaping a model using all of the data, which the Consultants believe reflected a more realistic representation of the continuity of the mineralized system.

The current Ulu mineral resource estimate is presented below at a 4 g/t gold (“Au”) cut-off value:

Flood Zone

ClassificationTonnesAu (g/t)Au (ounces)
Measured & Indicated2,500,0007.53605,000

Gnu Zone

ClassificationTonnesAu (g/t)Au (ounces)

Notes to the Resource Estimate

  1. Mineral resources, which are not mineral reserves, do not have demonstrated economic viability. The estimate of mineral resources may be materially affected by environmental, permitting, legal, title, taxation, socio-political, marketing, or other relevant issues.
  2. Confidence in the estimate of Inferred Mineral Resources is insufficient to allow the meaningful application of technical and economic parameters. There is no guarantee that all or any part of a mineral resource can or will be converted into a mineral reserve.
  3. The mineral resources in this estimate were calculated using the Canadian Institute of Mining, Metallurgy and Petroleum (“CIM”), CIM Standards on Mineral Resources and Reserves, Definitions and Guidelines prepared by the CIM Standing Committee on Reserve Definitions and adopted by CIM Council.
  4. The following parameters were used to derive the 4 g/t gold cut-off:
    1. - estimated CA $100/tonne mining, CA $25/tonne processing and CA $10/tonne general and administrative costs
    2. - Transporting gravity and flotation concentrate to the Lupin Gold Mine to produce dore, CA $25/tonne transport costs
    3. - CA $1500/oz gold price
    4. - Process recoveries of 90%
    5. - Smelter payables of gold at 96%
    6. - Refining charges of gold CA $12/oz

Exploration Focus

Blue Stars exploration focus going forward will be on expanding the known resource zones, testing priority targets proximal to the Flood Zone, and conducting regional exploration over the highly prospective property.

The Technical Information on the Ulu Property has been prepared in accordance with Canadian Regulatory requirements as set out in NI 43-101. The technical information was reviewed by Grant Ewing, P. Geo., a Qualified Person for the purposes of NI 43-101.

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