| The company was also granted an option to acquire an 100-percent interest in the 9 claim-unit Dobie Lake property located within Meen-Dempster Greenstone Belt, 8km east of Dorothy. Historic diamond drilling of the Dobie Zone outlined 301,000 tonnes averaging 5.5 g/t Au, open down plunge (OGS Open File Report 5869, MNDM).
All of the exploration results disclosed herein are historic in nature and do not presently conform to National Instrument NI-43-101 Standards of Disclosure for Mineral Projects. They have been reviewed, but not verified by Robert S. Middleton, P. Eng., who is our designated Qualified Person and responsible for the verification and quality assurance of our exploration data and analytical results. In the opinion of our Qualified Person, based on the information available, the mineralization at Kasagimminis, Dorothy and Dobie Lakes, would be classified as an Inferred Mineral Resource, based on the definition of the CIMM, since it will be required to do further infill drilling to establish grades. Therefore the historic figures should not be relied on.
The properties are approximately 125 km southwest of Musselwhite Gold Mine. Regional gold producers include Central Patricia Mine (621,806 oz. Au), Pickle Crow Mine (1,466,214 oz. Au) and Dona Lake Mine (336,000 oz. Au). The Golden Patricia Mine (860,000 tons grading 0.58 oz. Au), is located 7 km southeast (Hodge, H.J., P.Eng., 1986).
Diamond drilling was performed on Dorothy by the previous property holder, Major General Resources (6500ft.) and Umex ( 1987-1988, 27000 ft.) on the Main and West gold zones. The Main Zone is hosted in several vein systems within a diorite intrusive and the West Zone is hosted in mafic metavolcanic rocks. Both gold zones are found within the same shear structure, accompanied by a 30-50 meter wide alteration envelope. Gold mineralization in the Main Zone is associated with intense silicification, quartz veining and pyrite concentrations up to 10%. Diamond drilling in 1990 intersected a bonanza gold grade of 472.76 g/t Au over 0.5 meter. Gold mineralization in the West Zone is accompanied by pervasive carbonatization and quartz veining. Diamond drilling of the West Zone in hole DOR 88-32 returned assays up to 0.14 opt. Au over 2.9 meters and hole DOR88-34 returned an assay of 0.40 opt. Au over 1.5m.(Dyer, R., 1988, MNDM files). Geophysical surveys outline 3,800 meters of induced polarity (IP) drill targets outside of the Main Zone.
Gold mineralization on the Dobie Lake property is spatially related to quartz feldspar porphyry intrusions and is hosted within sheared metavolcanic flows and tuff interbedded with iron formation. Host rocks display strong silicification, carbonatization, sericitization and are mineralized with up to 8% pyrite and pyrrhotite.
Limited diamond drilling performed on the property outside of the main Dobie Zone indicates the presence of two additional gold-bearing horizons. Diamond drill hole M86-18 of Dobie Lake #1 returned 1.90 g/t Au over 3.0 meters and drill hole MD88-40B in the Spike Zone returned assays up to 5.99 g/t Au over 2.90 meters (OGS Open File Report 5869, MNDM).
Dragon also carried out geological mapping and prospecting on the original claims, where a number of copper and gold showings were studied.
Consideration for acquisition of the Dorothy Lake Property consists of option payments totalling $100,000 cash in stages over a five-year period plus advance royalty cash payments after the sixth anniversary totalling $150,000 and the issuance of 200,000 common shares upon regulatory approval, payable in four tranches of 50,000 common shares in stages over an 18-month period. A 2-per-cent net smelter return is retained by the optionor, 1 per cent of which may be purchased by the company at any time for $1-million with the remaining 1 per cent being subject to a right of first refusal. Sufficient exploration expenditures must be incurred to maintain the property in good standing.
Consideration for acquisition of the Dobie Lake Property consists of option payments totalling $70,000 cash in stages over a five-year period plus advance royalty cash payments after the sixth anniversary totalling $150,000 and the issuance of 200,000 common shares upon regulatory approval, payable in four tranches of 50,000 common shares in stages over an 18-month period. A 2 per cent net smelter return is retained by the optionor, of which 1 per cent may be purchased by the company at any time for $1-million with the remaining 1 per cent being subject to a right of first refusal. Sufficient exploration expenditures must be incurred to maintain the property in good standing.
In the spring of 2006 Golden Dragon completed a 381 km. airborne EM and magnetic survey over the Dorothy and Dobie Lake claim groups. The survey also covered the area between and beyond the original two claim groups. It outlined a well-defined structure in association with the two established gold zones that occur on each. As a result Dragon staked the extension of the 12.5 km. structure, with an additional 143 new claim units, bringing the total to 182 claim units, effectively joining the Dorothy and Dobie Properties into one.
Drilling on the Dobie Lake Property commenced in the summer of 2007.
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