The Zalantun Project includes four contiguous exploration licenses covering three properties totaling approximately 125 square kilometres in northeastern Inner Mongolia, China. The properties are situated in geologically favorable environments and include Pentouling, covering 73 km2; Bashenge, covering 14 km2 ; and Huangcaogou, covering 38 km2.

The project area is in the Tianshan-Hinggan Domain along the northern border of China, at the junction of the Altaids Belt and the Yanshanian Volcano-Plutonic Belt. Current exploration in southern Mongolia and northern China is demonstrating that this region is an important area for copper-gold porphyry deposits.

The Yanshanian Belt is part of the circum Pacific system. In China, copper and gold deposits associated with this belt include intrusion related lode gold deposits, porphyry copper-gold deposits, skarn copper-gold) and epithermal gold-copper deposits.

Two porphyry copper-gold deposits near Zalantun are the Tuanjiegou and Duobaoshan deposits. The Tuanjiegou deposit contains greater than 20 tonnes of 2.0 to 8.0 g/t gold, and the Doubaoshan deposit is a porphyry copper-molybdenum deposit.

During the early 1950s, the Ministry of Geology and Minerals completed a regional geological mapping program in the Zalantun area at 1:200,000. During the mid 1980s, a regional silt sediment survey was completed, which was followed by a second geological mapping program and heavy mineral sampling program.

The March 12, 2004 NI 43-101 report on the Zalantun property by George Cargill, Inter-Citic's independent qualified person, is available here in PDF format and on the SEDAR website.

Pentouling Property

The Pentouling Property is at the northeast end of the major Zinlitun-Habuqi-Aexhan Volcanic Eruption Zone. Most of the outcrops on the property are Jurassic volcanic rocks and include acid breccias, ash, rock debris, acid tuffs and devitrified glass. Former volcanic craters are indicated by ring fractures on satellite imagery. Wall rock alteration includes alunitization, kaolinization, silicification, sericitization, pyritization and epidotization, which is characteristic of large porphyry systems. Alunite, a mineral indicative of hydrothermal alteration, has also been identified on the property. Additionally, two stream sediment gold anomalies and two gold heavy mineral anomalies occur on the property, as well as one polymetallic anomaly containing copper, lead, zinc, silver, antimony, tungsten and bismuth mineralization.

Huangcaogou Property

The Huangcaogou Property is underlain by Jurassic felsic volcanics, including volcanic breccia, ash, rock debris and lithic and vitric tuffs. Felsic volcanics show varying degrees of alunitization, kaolinitization, silicification, sericitization, pyritization and epidotization. Magmatic rocks include granite and biotite granites of the late Variscan. A silver occurrence has been mapped at the contact with a granite porphyry. Associated minerals include magnetite, pyrite hematite, limonite, sphalerite (zinc iron sulphide) and chalcopyrite (copper iron sulphide). Additionally, there are significant gold anomalies on the property.

Bashenge Property

The Bashenge Property covers part of the northeast trending Aonierhe-Jiqinhe fault zone, where northeast, northwest and east-west faults intersect. A volcanic center and a heavy mineral anomaly for gold have been mapped on the property. A silver occurrence in a small quartz vein on the outer contact of a granite porphyry has also been discovered. Associated minerals include magnetite, pyrite, hematite, limonite sphalerite and chalcopyrite . A grab sample yielded 7.7 g/t silver and 0.02 g/t gold.

The geologic environment and the exploration model is very similar to the volcanic hosted porphyry copper deposits in British Columbia such as the Island Copper deposit. The Island Copper mine operated from 1971 to 1995, producing 400 million tonnes of ore containing 14 million tonnes of copper, 34 thousand tonnes of molybdenum, 1 million ounces of gold,11 million ounces of silver and 34 tonnes of rhenium.

Dr. D. George Cargill, P.Eng., Inter-Citic's independent Qualified Person, has visited the project and is currently completing his 43-101 report on the Zalantun group of properties Given the favourable geology and the existence of the Tuanjiegou and Duobaoshan porphyry copper-gold deposits on both sides of the project area, Dr. Cargill's report is available for review by clicking here.

Joint Venture Agreement

Under the terms of the Co-operative Joint Venture Contract, Inter-Citic can earn an 85% interest in the Joint Venture by contributing the equivalent of approximately CDN $2.36 million over 3 years. Contributions are staged as to the equivalent of approximately CDN $630,000 in the first year, CDN $1.26 million in the second year and CDN $470,000 in the third year. Inter-Citic also has the ability to acquire an additional 5% interest in the Joint Venture for the equivalent of approximately $278,000, for a total interest of 90%. In the event that Inter-Citic exercises this option, BIGM will retain a carried interest in the Joint Venture.