NKROFUL SMALL SCALE MINING

ASSOCIATION/GROUP
(NSSMA/G)

A REPORT ON AN EXPLORATION WORK COMPLETED

PHASE ONE
(GEOCHEMICAL SOIL SAMPLING)

PREPARED BY

ATSU SENANU KORTSU

PROJECT GEOLOGIST

31st May, 2015

Table of Contents Page

1.0 Introduction………………………………………………………………………………3
1.1 Location and Accessibility……………………………………………………………….3
1.2 Geographical Setting……………………………………………………………………..4
2.0 Southern Ashanti Project/Regional Geology…………………………………………….5
2.1.1 Avrebo Domain………………………………………………………………………..5
2.1.2 Salman Domain………………………………………………………………………..6
2.1.3 Anwia Domain…………………………………………………………………………7
2.2 NSSMA/G Project Geology……………………………………………………………...8
3.0 Gold deposit of Southern Ashanti Gold Project of Adamus Resources Ltd (Endeavor
Mining Corporation)………………………………………………………………………...10

4.0 Work Completed...………………………………………………………………………11

4.1 Grid lines cutting..……………………………………………………………………….11
4.2 Geochemical Soil sampling…………...……………………………………………...…12
4.3 Geological field mapping and rock chip sampling……..……………………………….13
4.4 Laboratory sample Analysis…………………………………………………………….16
4.5 Disclaimer……………………………………………………………………………….17
5.0 Financial report………………………………………………………………………….17
6.0 Conclusion………………………………………………………………………………18

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List of Figures Page

Figure 1: Map showing location and accessibility of NSSMA/G project…………………..4

Figure 2: Map of Southern Ashanti Gold project……………………………………………8
Figure 3: Geology map of NSSMA/G………………..……………………………………...9
Figure 4: Southern Ashanti Gold project location plan………………………………….….10
Figure 5: Adamus and NSSMA/G Tenements and gold deposit areas of Adamus………...11
Figure 6: Geochemical soil sampling map………………………………………………….13
Figure 7: Map showing boulders/floats locations during geological field mapping…….....14
Figure 8: Regolith map and Quartz vein Lode……………………………………………...15
Figure 9: Map showing comparison of interpreted mineralization at Bokrobo with
Inferred mineralization at NSSMA/G………………………………………………………16

List of Tables Page

Table 1: Pillar coordinates of NSSMA/G concession………………………………………3

Table 2: Financial statements for geochemical soil sampling………………………….….17

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1.0 Introduction
Nkroful Small Scale Mining Association and Group (NSSMA/G) is an emerging gold producer
on a smaller scale situated on the southwestern end of the Ashanti gold belt within the Nkroful
Mining License tenement of Adamus Resources Ltd.

The Nkroful Small Scale Mining Association License which covers an area of 0.22km2 (55.38
acres) is situated in the Nzema East District and the newly created Ellembelle District of the
Western Region of Ghana. However, as part of phase one of exploration programme, soil
geochemical sampling has been carried out over the concession to delineate economic deposit
for exploitation.

1.1 Location and Accessibility

The Nkroful Small Scale Mining Association License is located about 90km by road west of
the port city of Takoradi and about 300km from the national capital, Accra. The license area
can be reached by road using the Takoradi-Elubo highway, branching of at Esiama onto a
second-class road to Nkroful. The concession map and boundaries are as shown in Figure 1
and pillar positions and coordinates are in Table 1.

Table 1: Pillar Coordinates of Nkroful Small Scale Mining Association Concession

Points Longitude Latitude

P1 2º 20' 06"W 4º 57' 44"N
P2 2º 19' 59"W 4º 57' 56"N
P3 2º 19' 43"W 4º 57' 39"N
P4 2º 19' 52"W 4º 57' 34"N

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Figure 1: Map showing the location and accessibility of NSSMA/G project

1.2 Geographical Setting

The topography of the concession area includes high grounds reaching about 100m above
mean sea level and slopes down towards both western and eastern sides with streams.

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Vegetation in the area comprises mainly secondary forest and farm lands. Generally, farming
in this area is of a subsistence nature, dominant crops being cassava and maize. Other areas
have been farmed with such cash crop as coconut, oil palm, cocoa and rubber.

Two main rainy seasons are identified with the area, associated with some stormy and
torrential rains resulting in intense run-offs. The major season occurs from March to July with
maximum precipitation occurring in May to June. The minor rainy season starts from
September to November. The month of August has a short, dry and cool period in between the
main and the minor rainy seasons. The main dry season starts from December to February.

2.0 Southern Ashanti Project/Regional Geology

Basement exposure is generally poor within the Southern Ashanti project of Adamus. Laterite
and mottled clay zones are locally developed on ridges. The western part of the project is
largely underlain by Birimian metasedimentary rocks of basin and basin margin affinity in the
south-western corner of the Kumasi Basin and the Birimian metavolcanic and volcaniclastic
rocks of the Ashanti Volcanic Belt underlay the eastern portion.

The Birimian volcanics are thought to be faulted against the Tarkwaian Group immediately
northeast of the project area, and a small area of quartz-rich fluvial rocks immediately east of
Axim may also belong to the Tarkwaian (see also Loh and Hirdes, 1996, Griffis et al., 2002).
A large biotite granite body is exposed in the western part of the project area and probably
belongs to the Cape Coast suite. Dixcove-type granitoid batholiths intrude the volcanics at the
eastern edge of the project. Several narrow granitoid dykes and fault slivers up to 13 kilometres
long and 700 metres thick of uncertain affinity are scattered through the project area.

There is no formal subdivision of the Birimian Supergroup in the project area but several
lithologically and geophysically distinct units can be identified and three litho-structural
domains are recognised: Avrebo, Salman and Anwia.

2.1.1 Avrebo Domain

The Avrebo Domain encompasses the eastern part of the project area underlain by Birimian
volcanic and volcaniclastic rocks, minor Birimian greywacke and phyllite packages, and
Dixcove-type intrusive bodies. Primary layering is generally steep and strikes north-northeast
to northeast. Cleavages are not particularly well developed in the volcanic lithologies (cf.
phyllite and greywacke packages) but at least two or three weak foliations are evident in most
exposures and are of similar orientation to those of the Salman Domain (below). Scattered
lenses of greywacke and phyllite within the volcanic rocks are probably fault bounded, and a
large north to northeast striking shear zone is identified within the volcanics in the Avrebo
area. The Avrebo Domain covers the southwestern edge of Ashanti Belt, and the volcanics
appear to be faulted against a package of basin margin metasediments to the west (Salman
Domain). The eastern margin is undefined.
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2.1.2 Salman Domain

The Salman Domain comprises a zone 4-5 kilometres wide immediately west the Ashanti
volcanic belt comprising near-vertical north to northeast striking metasedimentary packages
separated a series of similarly oriented mylonitic shear zones informally termed the Ankobra
Fault Zone. Greywacke and phyllite packages dominate the Salman Domain, minor lithologies
include redeposited andesitic to dacitic crystal-lithic tuffs, pebbly volcanogenic greywackes
and conglomerates, and rare andesitic dykes or flows. The Adamanso Shear Zone separates
the Salman Domain from the Avrebo Domain (belt volcanics) to the east, and the Aluku Shear
Zone from metasediments of the Anwia Domain (basin) to the west.

Four distinct cleavages and fold generations recognised. S1 is a strong graphitic cleavage
parallel to S0 and presumably developed during regional isoclinal folding, the main
architectural event. Facing is rarely identifiable in saprolitic exposures but is generally
westwards. Centimetre-scale isoclinal F1 folds in S0 were observed at one locality. S2, a thick
graphitic crenulation, is generally the most conspicuous cleavage and is axial planar to
widespread metre-scale, south to southwest plunging, open to close folds. Varying asymmetry
suggests the presence of large scale F2 folding, and some 100-200 metre wavelength open folds
mapped along the Salman Shear zone are thought to be F2 structures. S2 generally strikes
between east and northeast, dips between 50° and 90° to the southeast, and the average F2 axis
is orientated c. 65→220. S3 is a thinner and typically finer crenulation than S2. Strike is
northwest and dip is steep (average c. 80° to northeast). Metre-scale open F3 folds in S0 and S2
can be observed at a few localities but are not as well developed and widespread as F2 folds.
Some of the larger scale (100-1000 m) rotation of S2 within the Salman Domain is attributed to
medium scale F3 folds. S4 is a weak sub-horizontal cleavage only locally discernable
associated with gentle open folding and warping of S0, S1 and S2.

The Salman Shear Zone, host to the Salman Trend gold deposits, is the best known and
explored fault within the Ankobra Fault Zone. While the Salman Shear Zone appears the main
locus of gold mineralisation, pockets of gold mineralisation have been identified on or adjacent
to other faults within the Ankobra fault set, including the Mamposo and Adamanso shear
zones.

The Salman and Mamposo shear zones are defined by both geological mapping and
geophysics, while the other members of the Ankobra fault set, including the Adamanso and
Aluku shear zones, are based on S0 discontinuities defined by geophysics. Detailed mapping
and geophysical interpretation shows that Salman Shear Zone extends from the Gulf of Guinea
coast between Asanta and Sawoma for at least 20 kilometres through Salman and Akanko and
north of the Ankobra River to the Banso area. It is then interpreted to continue for further 30
kilometres north, along with several of the other Ankobra faults, to merge with the Central
Fault Zone of Allibone et al. (2002b) at Prestea-Bogosu: fabrics and lithologies within the
Salman Shear and Central Fault Zone are closely comparable.

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Exposures of the Salman and Mamposo shear zones are characterised by the presence of tightly
folded and boudinaged greywacke beds and quartz veins within a highly deformed zone of
graphitic mylonite and phyllite up to c. 125 metres thick. The mylonitic fabric and S1 are both
crenulated by S2 indicating a D1 origin for the Ankobra fault set and development was
presumably associated with regional D1 isoclinal folding during west-northwest – east-
southeast compression. Outcrop observations indicate dextral reactivation of the Salman Shear
during D2 and sinistral reactivation during D3, but the bulk of the strain appears to be D1.
Several slices of altered, S1-foliated biotite-ilmenite granitoid, termed the Akanko Granitoid,
are included within the Salman Shear: all observed contacts are faulted (typically mylonitic)
and the bodies were either structurally modified after intrusion within the shear zone or entirely
structurally emplaced.

2.1.3 Anwia Domain

The Anwia Domain is characterised by modest S0 dips over large areas and large-scale open
folding of S0. Porphyroblastic greywackes, phyllite, and kaolinitic (ex-vitric?) redeposited tuff
are the dominant lithologies: the thick kaolinitic tuff packages, widespread porphyroblasts,
and generally low graphite content distinguish the Anwia Domain lithologically from the
adjacent Salman Domain. There is no evidence yet for the presence of the large graphitic
phyllite and mylonite shear zones which characterise the Salman Domain.

The S1, S2, S3 and S4 cleavages are of the same style as for the Salman Domain, although S2
and S3 are of much more variable orientation (rotated by up to 90°) indicating large-scale, open
post-F3 folding. Geophysical interpretation (especially EM) supported by a few field
observations suggests a kilometre-scale dome and basin geometry within the Anwia Domain.
Metre-scale dome and basin folding produced by F2-F3 interference was observed in outcrop at
the Anwia Deposit. The few available facings suggest the sedimentary sequence is extensively
overturned.

The western margin of the Anwia Domain is not defined; the eastern margin with the Salman
Domain is placed along the geophysically inferred Aluku Shear Zone. By analogy with thin-
skinned fold-thrust belts the Aluku Shear Zone could represent the oldest, basin-ward thrust in
an imbricate fault zone, and the Mamposo, Salman and Adamanso shear zones represent
progressively younger thrusts formed as the Birimian basin (Anwia Domain and west) was
pushed eastwards over the Birimian volcanic belt during regional D1 compression. Similar
character of S2 to S4 in both Salman and Anwia domains suggests a common post-D1
deformational history, comprising sinistral (D2) then dextral (D3) modification and reactivation
of the D1 architecture, followed by post-orogenic relaxation (D4). The same sequence of
compression with isoclinal folding and thrust fault development, followed by sinistral then late
dextral wrenching has been proposed for the Obuasi-Ashanti area c. 150 kilometres along
strike to the north-northeast (Allibone et al. 2002a).

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Figure 2: Geology map of Southern Ashanti Gold Project

2.2 NSSMA/G Project Geology

The project is situated within the Adamus Nkroful Mining Licence area and is largely
underlain by Birimian metasedimentary rocks of basin and basin margin affinity in the south-
western corner of the Kumasi Basin with associated basin granitoids. From mapping and
trenching, the metasedimentary rocks are found to be greywacke and phyllite. Other lithologies

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that have been found in the area include quartz veins (white, milky and/or grey). Laterite and
mottled clay zones are locally developed on ridges.

Figure 3: Geology Map of NSSMA/G project

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3.0 Gold deposit of Southern Ashanti Gold Project of Adamus Resources Ltd (Endeavor
Mining Corporation

Exploration within Adamus Resources Limited’s Southern Ashanti Gold Project, Ghana has
led to the delineation of substantial gold mineralization in a number of discrete deposits.

Gold has been mined on a small scale from southwestern Ghana for centuries and the Gold
Coast Geological Survey recorded widespread bedrock and alluvial workings at many
locations within the area now covered by the Southern Ashanti Gold Project. Historic
production from the small Akanko gold mine may have amounted to a few thousand ounces
but otherwise there are no historic production estimates. Small-scale artisanal gold mining
activities (both alluvial and reef) continue to occur at a few localities within the Project area.

However the Nkroful small scale mining association/group (NSSMA/G) is located about 1km
northwest of some of the Adamus major resource or gold deposit area (Bokrobo, Fig. 5) and
mineralization at NSSMA/G is inferred to be running NNW-SSE parallel to the interpreted
mineralization trend at Bokrobo (Fig. 9).

Figure 4: Southern Ashanti Gold Project location plan

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Figure 5: Adamus and NSSMA/G Tenements and gold deposit areas of Adamus.

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4.0 Work Completed

4.1 Grid Lines cutting

A base line was established on the bearing 180 degrees. Cross lines were then cut
perpendicular to the base line on a sampling grid of 100 m x 50m on the bearing 090º using
hand-held GPS and compass and clearly labeled wooden pegs placed at 50m intervals sample
location on each cross line. A total of 10.5km of lines were cut.

4.2 Geochemical Soil Sampling

Geochemical soil sampling activities started on the 18th April, 2015 and ended on the 9th May,
2015 over the entire NSSMA/G project. A total of 204 samples of approximately 2.5kg each
including QAQC samples were collected on the 100m x 50m grid. Coordinates of all sample
points were recorded with a handheld GPS. Samples were taken within B-horizon at the depth
of 50cm. Logging of the samples was handled by the project geologist. The regolith logged
were dominantly clayey with and without lateritic and quartz fragments. However, clayey
regoliths with quartz (grey) fragments give an indication of possible good anomalous zone.

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Figure 6: Geochemical soil sampling map

4.3 Geological field mapping and rock chip sampling

Geological field mapping was carried out on entire project area to ascertain the fair knowledge
about the geology of the area. Though outcrops were very rare, few boulders and floats of
quartz were mapped and some sampled. Generally, the quartz boulders and floats observed

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were light-grey to dark-grey types with iron-stains and silica alterations, and occasionally
micacious minerals. There has been a grey quartz vein exposed by Galamsey workers at the
southeastern part of the concession which trends NNW-SSE. This vein was observed to have
come with an intrusive dyke (dacite) and has a lot of coarse-grained to fine-grained sulphide
(pyrites). A total of ten (10) rock chip samples were taken for laboratory analysis.

Figure 7: Map showing boulders/floats locations during geological field mapping

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Figure 8: Regolith Map and Quartz vein Lode

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Figure 9: Map showing comparison of interpreted mineralization trend at Bokrobo with
inferred mineralization trend at NSSMA/G

4.4 Laboratory Sample Analysis

None of the samples have yet been submitted for laboratory test due to financial constraint.
However, all samples preparation and analysis (50g fire assay) will be done by Intertek
Laboratory at Tarkwa. Final gold value will be determined by AAS.
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4.5 Disclaimer

This document has been prepared for the exclusive internal use of the Investor on the basis of
instructions, information and data supplied by them. No warranty or guarantee, whether
express or implied, is made by the Author with respect to the completeness or accuracy of any
aspect of this document and no party, other than the Investor, is authorized to or should place
any reliance whatsoever on the whole or any part or parts of the document. The Author do not
undertake or accept any responsibility or liability in any way whatsoever to any person third
party in respect of the whole or any part or parts of this document, or any errors in or
omissions from it, whether arising from negligence or any other basis in law whatsoever

5.0 Financial Report

A total amount of eight thousand, nine hundred and ninety-seven Ghana cedis twenty pesewas
(GH₵ 8,997.20) has been spent during the sampling and mapping activities.

Table 2: Financial Statements for geochemical soil sampling completed on NSSMA/G project

Category Cost Centre Amount (GH₵)

General Laboratory Charge (samples) Awaiting analysis

Subtotal
Personnel Line Cutters/ samplers wages 2,500.00
Subtotal 2,500.00
Vehicle Fuel for Vehicle 728.00
Subtotal 728.00
Project Geologist 2,000.00
Geological Asst. 1,000.00
Allowance
Communication (cards) 80.00
Supervisor 460.00
Subtotal 3,540.00
Flagging tape (roll) 500.00
Cutlass 90.00
AA Energizer Batteries (pairs) 30.00
Hammer 40.00
Polywoven Sacks (standard) 56.00
Field Logistics
Digging Tools (Sorsor) 95.00
Pen(box) 30.00
Clutch pencil(box) 11.20
Permanent Marker Pens (box) 9.60
Measuring Tapes 31.00

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 Nylon rope & twine 15.80
Subtotal 908.60
Arc file & perforator 21.20
Stapler & pins 60.00
Clip file 12.00
Stationery Eraser 5.00
A4 Sheet ream 17.00
Pocket notebook 3.00
Subtotal 118.20
Printing & photocopy 32.40
Torch light 60.00
Others Cardboard 10.00
Blank sample 500.00
Miscellaneous 600.00
Subtotal 1,202.40
Grand Total (GH₵) 8,997.20

6.0 Conclusion

The geochemical soil sampling programme may therefore warrant further exploration works on
the project based on the laboratory results of the soil samples and the rock chips to better
delineate the gold deposit. These may include trenching or pitting on the anomalous zones and
subsequently drilling.

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