Summary
The Golden Chest mine is located 2 kilometers east of Murray, Idaho. Since 2004, the Company has completed a program of exploration, development and gold production at the Golden Chest.  Exploration activities have included 3,415 meters of diamond drilling which resulted in a block of ore reserves on the Idaho vein containing 37,885 ounces of gold.

Development activities have included the construction of surface facilities, the completion of 500 meters of ramp, and the establishment of a rock storage site. Gold production has been on an intermittent basis as mining activity alternates between driving the ramp and mining remnant blocks of material from the Katie and Dora veins. Ore is shipped to the Company’s mill facility in Kellogg, Idaho where a bulk flotation concentrate is then leached to produce a gold-silver dore’. Gold production has totaled approximately 2,000 ounces to date, and the Company plans to increase gold production to 4,000 ounces per year by completing about 400 meters of ramp from a new portal which is required to access the Idaho vein ore reserve block. The timing of the completion of the new portal and ramp will be dependent upon the Company’s ability to raise financing on favorable terms.

Golden Chest, road and North Idaho setting

Land Position
The Company's land position at the Golden Chest covers an area of about 500 acres. Approximately 270 acres is held through a mining lease with Metaline Contact Mines that calls for a sliding scale Net Smelter Return (NSR) royalty, and 41 acres of unpatented claims is held through a similar mining lease with a private corporation. Both leases require NJMC to pay a minimum of 3% of the net smelter returns to the lessor. An additional royalty ranging from 1% to a maximum of 3% NSR is payable, if the price of gold reaches certain trigger points as adjusted by the Consumer Price Index (CPI). About 195 acres are held through unpatented claims wholly owned by the Company but subject to a 1% Net Profits Royalty payable to Metaline Contact Mines.

Exploration and Production Plans
As mentioned above, the Company’s immediate plan is to drive a new adit of about 400 meters in length to connect with the existing workings. This new adit will provide access to the Idaho vein ore reserve block which will provide about six years of mill feed for the New Jersey mill. The new adit will also provide a platform for diamond drilling the Idaho, Katie and Dora veins at depth. The Idaho vein reserve block is open to expansion both up dip and down dip, and management expects that the property gold resource could be increased to 500,000 ounces with sufficient drilling.

Geology
Gold mineralization is associated with a thrust fault. Gold-bearing quartz veins are hosted by folded siltite-argillite and quartzite of the Prichard formation. Two types of veins are found are the Golden Chest: banded veins and massive veins. The banded veins consist of white quartz with thin planes of dark gray argillite that may be partly replaced with sulfides. The other type of quartz veining is massive and typically quartzite hosted. Sulfide minerals found in the massive veins are pyrite, sphalerite, galena and chalcopyrite. Scheelite, a tungsten mineral, is also found in scattered pods throughout the veins.

View of the Katie Vein (White Quartz) on 965 Sublevel showing the intense folding associated with the vein

** Inferred Resources
The United States Securities and Exchange Commission permits mining companies, in their filings with the SEC, to disclose only those mineral deposits that a company can economically and legally extract or produce. We use certain terms, such as "measured," "indicated," and "inferred resources," that the SEC guidelines strictly prohibit us from including in our filing with the SEC. U.S. investors are cautioned not to assume that any or all of measured, indicated or inferred resources are economically or legally mineable or that these resources will ever be converted into reserves. U.S. investors are urged to consider closely the disclosure in our Form 10-K and Form 10-Q.