Niblack Project: Introduction

Heatherdale Resources Ltd. has the right to retain a 51% interest in the Niblack Project from Niblack Mineral Development by expending US$15 million and an option to acquire up to a 70% interest by expending an additional US$10 million and completing a feasibility study. Heatherdale is affiliated with the Hunter Dickinson group, a public company associated with successful mineral exploration and development projects throughout the Pacific Rim. This advanced stage gold-rich VMS exploration project is located at the southern tip of the Alaskan panhandle on Prince of Wales Island approximately 43 kilometers southwest of Ketchikan, Alaska. The majority of the 6,238 acre property was acquired through the takeover of Niblack Mining Corp. in October of 2008.

The Niblack deposit supported historic underground mining operations from 1905 to 1908, producing ~20,000 tons of ore grading 4.9% copper, 2.2 g/t gold and 30 g/t silver. The deposit has been the focus of extensive exploration activity over the past 34 years, including 59,289 meters (194,518 feet) of drilling in 246 holes. The property has been actively explored since 1985 and consists of six major zones of mineralization. Since 2005, drill programs have focused on the Lookout and Trio zones of mineralization and in September 2008 the first milestone of the year was achieved with release of an initial resource estimate which was updated with the 2008 underground drilling in March 2009 and an improved metallurgical results in June 2009, the resource is now comprised of 2.59 million Indicated and 1.7 million Inferred tonnes of ore (See Resource Summary page for Niblack resource details).

The second milestone of 2008 was the completion of an 880 metre exploration drift. This drift facilitates better underground drill positions for continued down-plunge expansion of the Lookout resource.  A total of 4,507 metres of drilling in 19 holes was completed from the drift on the Lookout Zone and significant intersections were achieved, the majority of which were outside of the initial resource.  The potential for expanding the current Niblack resource was demonstrated by the final drill hole of the 2008 underground drill program (U28), which was aimed along the previously untested western extension of the Niblack trend.  Although drilled at a low angle to the apparent trend of the mineralization, Hole U28 intersected a significant thickness of massive and semi-massive sulphides including, 78.66 m of 4.83 g/t Au, 85.31 g/t Ag, 1.89% Cu and 4.93% Zn. 

More recent milestones for the project include: Formation of a Joint Venture with Hunter Dickinson (July 2009), Upgrade of metallurgical studies (June 2009), additional staking of 1,150 acres (June 2009), and Release of updated 43-101 compliant resource estimate (March 2011).

THE POTENTIAL of the Niblack Project is believed to be excellent for delineating additional areas of high-grade copper-gold-silver-zinc mineralization. Core drilling and other geological investigations have been undertaken and are being designed to expand the known mineral resources. Given its geological endowment and proximity to tidewater in a stable jurisdiction with a long-tradition of mineral development, Niblack property has the potential to support a low volume, high-grade underground mining operation in the future.

Project Highlights:

• 49% owned high-grade Au-Cu-Ag-Zn volcanogenic massive sulphide (VMS) project
• 6,238 acres of land including patented/private property
• Tidewater location offers year-round access to property
• Mineral inventory includes:
  • Indicated Resource of 4.1Mt grading 2.32 g/t Au, 38.70 g/t Ag, 1.13% Cu and 2.27% Zn
  • Inferred Resource of 2.5Mt grading 1.77 g/t Au, 25.90 g/t Ag, 1.21% Cu, and 2.29% Zn
• Underground exploration drift in place for improved drilling, can potentially be used for future mining