Azimut Exploration Inc.

Nunavik

POLYMETALLIC

1 Rex (Cu-Au-REE)

2 Duquet (Au-Ag-Cu)

3 Rex South (Cu-Au-W)

URANIUM

GOLD

REX PROPERTY

General location map showing the main deposit types and prospects of the Rex South Property and other Azimut holdings in Nunavik, Northern Quebec. The Rex, Duquet, Rex South and NCG properties are positioned along the 300-kilometre-long Rex Trend.

Map of the Rex (and Duquet) properties showing selected grab and channel sample results. Note that this figure shows only the AB Block of the Rex Property.

Polymetallic (copper-gold-REE) property

The wholly-owned polymetallic Rex Property (1,144 claims as at April 21, 2016; 488.2 km²) covers a largely outcropping 80-kilometre-long area located approximately 90 km east of the Hudson Bay coastal community of Puvirnituq, in Nunavik, Northern Quebec.

Key Coverage of the Rex Trend

The Rex Property occupies the northern segment of the Rex Trend, which management considers to be a new mineral province with the potential to host large-scale deposits, including iron oxide copper-gold (“IOCG”), intrusion-related polymetallic and sediment-hosted gold. The Rex Trend shares similarities with the Carajás Mineral Province in Brazil.

IOCG-type targets

Since announcing the initial copper discovery at Rex, Azimut has identified more than 20 copper or polymetallic (copper-gold-silver-cobalt-tungsten) prospects. Drilling results, supported by prospecting, geological, structural and geochemical data, have confirmed several multi-kilometre IOCG-type targets. Azimut is also investigating the property’s potential for other mineralization types, including diamonds.

Mineralized zones

The two main zones on the property, RBL and CM, were discovered during Azimut’s initial exploration program in 2010.

RBL Zone
The RBL Zone is at least 3 km long by 50 to 200 m wide with a maximum grade to date of 11.3% Cu (grab sample). The preliminary 2011 drilling program (1,764 m in 23 short holes: 21 rotary, 2 RC) yielded the following best grades: 0.34% Cu over 4.58 m, 0.13% Cu over 9.14 m, 0.14% Cu over 13.72 m, 0.64% Cu over 1.52 m and 0.17% Cu over 6.10 m. An envelope of mineralization and alteration is recognizable over the entire zone, and the drilling program revealed that copper values are frequently associated with anomalous values of cobalt and tungsten in a wide (up to 200 m) envelope containing anomalous barium, manganese, phosphorus and iron.

CM Zone
The CM Zone measures at least 2.5 km long by 50 to 100 m wide with a maximum grade to date of 4.3% Cu (grab sample). An envelope of mineralization and alteration is recognizable over the entire zone at surface, and the 2011 drilling program (408 m in 6 short holes: 5 rotary, 1 RC) revealed a strong alteration system 150 m wide, with anomalous copper, cobalt, tungsten, molybdenum, barium, manganese, phosphorous and iron values.

Mineralization and geology of RBL and CM
The mineralization of both zones is present as breccias hosted by migmatitic gneisses. The breccias contain chalcopyrite, bornite and pyrite (± covellite) and networks of magnetite and/or hematite with or without quartz veins/veinlets. Alteration is dominated by strong potassic alteration and pervasive silicification locally accompanied by albite, chlorite and epidote. Anomalous values in gold (up to 0.16 g/t Au at RBL), silver (up to 5.0 g/t Ag at RBL; up to 9.0 g/t Ag at CM) and cobalt (up to 1,130 ppm Co) were announced for surface grab samples collected during the 2010 program.

The geological context of the RBL and CM zones (large alteration and breccia systems spatially associated with regional-scale structures) may indicate significant depth to the systems, and both zones show excellent potential for extensions based on their strong magnetic signatures and geochemical footprints in lake-bottom sediments. Azimut considers them to be significant IOCG-type targets. Furthermore, the two zones, spaced 27 km apart, demonstrate the regional scale of mineralization on the Rex Property.

Other prospects
A number of other prospects on the property, several of them kilometre-scale, have also yielded significant grades for copper (up to 4.4% Cu), gold (up to 16.2 g/t Au and 580.0 g/t Au), silver (up to 196.0 g/t Ag), tungsten (up to 0.87% W), molybdenum (up to 0.65% Mo), rhenium (up to 0.91 g/t Re) and bismuth (up to 285 ppm Bi). In addition, results in the southern part of the property revealed a 4-kilometre trend defined by anomalous barium values (up to 11.95% Ba) within a strong, 13‑kilometre copper-molybdenum-cobalt-REE-manganese footprint in lake-bottom sediments. This area represents a top-priority IOCG target.

Mineral potential assessment

Azimut’s management is of the opinion that the Rex Property has the potential to become an important metal district in Northern Quebec. Field work and analytical results to date validate Azimut’s assessment of the Rex Property as highly prospective for IOCG-type deposits. The IOCG deposit-type encompasses a wide spectrum of ore bodies, often polymetallic and of significant size, which may notably produce iron, copper, gold, uranium, silver, cobalt and REE. The best known IOCG example is Olympic Dam in Western Australia, one of the largest known deposits in the world. Other prospective zones on the property may be related to deposit types typical of Archean greenstone belts, such as copper-gold mineralization in shear zones and volcanogenic massive sulphides. In addition, the 2010–2011 programs revealed strong exploration potential for diamonds. The ongoing assessment takes into account the results of an infill multi-element lake-bottom sediment program, a detailed aeromagnetic survey, a structural interpretation, and prospecting work on for newly discovered ultramafic intrusive rocks and carbonatite dykes. The Rex, Duquet, Rex South and NCG properties cover a deep-seated structural corridor (the “Allemand-Tasiat Zone”), which has been recognized as prospective for diamonds by the Ministry of Natural Resources of Quebec.

Exploration work

The 2011 exploration program was part of Azimut’s self-funded $3.9-million combined exploration program for the Rex and NCG properties. The program comprised the following: ground-based geophysical surveys (49.2 line-km of IP and 122.3 km of magnetics) to better define drilling targets on the RBL and CM zones; infill lake-bottom sediment sampling (614 samples) to further define targets in the western part of the project; 1,116 grab rock samples from outcrops and boulders during property-wide prospecting; and 2,172 m of reconnaissance drilling. The drilling program consisted of 29 short holes (2,113 m in 26 rotary holes, and 59 m in 3 RC holes) from which 1,382 drill samples were sent for analysis.

In 2012, Azimut’s self-funded $765,000 Nunavik program, which included the Rex Property, was designed to increase the sampling density on known quality mineralized zones, and to perform reconnaissance prospecting on newly defined targets. A total of 175 rock grab samples were collected on the Rex Property.