technical report on the nechalacho deposit, thor lake project ...

approach that introduces a certain amount of dilution). The upper boundary of the BZ was
generally defined as a soft contact where the TREO% was greater than 1% and the HREO%
was greater than 0.15. The volume between the top of the BZ and the base of the
overburden/water was flagged as UZ. Where there were sharply defined zones of waste above
the last zones of mineralization in the upper zone (toward surface), these areas were also
excluded. The model used the Grace Lake Granite as the southernmost extent of the both the
Upper and Basal Zones. In general the model in the remaining azimuths was clipped to the last
intersections of the Basal Zone. However as previously mentioned, some holes to the north
which contained significant intersections were excluded due to their distance to the nearest
adjoining drill hole.
COMPOSITES
Two-meter composites were created for each element from the raw assays in the database.
These composites were constrained by the upper and lower boundaries of the Upper and Basal
Zones and flagged with the appropriate zone code. Unlike previous resource calculations the
model was not “flattened “prior to compositing. While there is some anecdotal evidence to
suggest that the basal zone was originally “flat””, the variograms do not seem to support this
hypothesis. Neither do the grade graphs (Figure 1), which show a general increase of grade
with depth. This would not be expected if the deposit was folded/moved after deposition. Note
that composites were not extracted from the diabase dykes that cross-cut the deposit.
Technical Report 43-101 – March 13, 2011 Page 17-6
Prepared by Avalon Rare Metals Inc.