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Projects

Kootenay Project

Properties

Ledgend

Introduction

The Ledgend Property (1735 Ha) was the first documented occurrence of nickel-cobalt bearing massive sulphides in the region. Discovered by prospectors in 1981 during construction of a logging road, the showing was not subsequently staked until 1997. The mineralization was described in 1998 by the B.C. Geological Survey as outcropping massive pyrrhotite with nickel and cobalt minerals. The geologist noted that the mineralized horizon could be traced over hundreds of meters along strike. Subsequently largely overgrown, in 2016 the new owners relocated float from the discovery outcrop and grab sampling returned values of 0.15 to 0.76% nickel and 0.01 to 0.09% cobalt, as well as up to 0.53% chrome and anomalous copper and zinc. Subsequent work in 2016 included soil geochemistry covering an area 500 by 1600 metres at 25 metre spacing on 100 metre lines. This generated a nickel-cobalt anomaly 800 metres in length extending to the southeast of the showing, with the peak of the anomaly (values up to 0.84% nickel) located on a steep slope about 200 metres southeast.

Cardero's soil sampling in fall 2017 expanded on the sampling completed in 2016 by the owners (the "North Grid") and added a second grid 1.8 kilometres to the south ("South Grid"). In addition, an outcrop near the original discovery was cleaned and chip sampled perpendicular to foliation, returning 4 metres of 0.22% Ni and 161ppm Co (Plate 1), with a one metre sample running 0.39% Ni and 0.028% Co. A 20-30cm layer of massive to semi-massive pyrite-pyrrhotite occurs between an upper horizon of siliceous biotite schist and lower horizon of talc-tremolite schist. True widths should be close to sample widths, but might vary significantly due to the tight folding. The 1,218 soil samples produced significant anomalies for follow-up work in 2018, mainly in the North Grid.

A conformable and probably syngenetic horizon of manganiferous exhalite is associated with the massive sulfides located to date. Sampling has intermittently traced this horizon throughout the length of the soil grid and beyond, from at least 400 metres to the north to some 4,500 metres to the south, where similar conformable sulfide mineralization occurs along a road cut. The northern portion of the claims covers two kilometres of the horizon's strike and will be sampled in 2018.

Mineralization Model

The mineralization is hosted by northwest-trending, tightly folded sericite and biotite schists, quartzite, and talc-tremolite schist of the Index Formation, a member of the Lardeau Group. Graphitic and manganiferous layers are particularly anomalous in metals, and thought to be seafloor exhalatives generated by submarine hydrothermal fluids. The rock types and style of mineralization are most similar to the Outokumpu and Talvivaara districts in central and eastern Finland.

Cross Section of the Keretti Mine, Outokumpu VMS District, Finland

Ongoing study as to how shale hosted, or shale associated, Ni-Cu-Zn-Co deposits form has led to recognition of oceanic detachment faults on the modern day ocean floor that have focused large volumes of black smoker fluids along an ultramafic - volcanic (or sediment) contact. This results in metasomatic alteration of ultramafics to talc-tremolite-chlorite schists along the fault. By this process, distal venting of Ni-rich fluids can form "VMS" deposits far from a spreading ridge, in or under quiet basins where shales deposit. If fault involves a sedimentary package, the fluids can precipitate subsurface, within shales or sandstone, which are later deformed and metamorphosed to black schist and quartzite.

Deposit model for mineralization at Ledgend, and probably the other properties in the project. Modified from Jowitt and Keays (2012): Shale-hosted Ni-(Cu-PGE) mineralisation: A global overview.

North Grid Soil Geochemical Anomalies

The North Grid generated new soil anomalies both east and west of the original central anomaly. This grid, centred on the discovery showing, now covers an area 1100 by 2000 metres at 25 metre sample spacing on 100 metre spaced lines. The central nickel-cobalt ("Ni-Co") ("Central Zone") soil anomaly is 800 metres in length extending to the southeast of the showing, with the peak of the anomaly (values up to 0.84% Ni, 0.025% Co) located about 200 metres southeast of the massive sulphides in the discovery outcrop. This anomaly is associated with float of the same talc-tremolite-actinolite schist that occurs as the footwall to the massive sulphides, and which is the altered remnant of high Ni-Co ultramafic rocks. Trenching of the anomaly is planned to test Cardero's interpretation that the source of the nickel is buried massive sulphides.

About 400 metres to the north of the discovery showing, a separate Ni-Co peak at the north end of the anomaly occurs in a recessive area below a cliff of siliceous biotite schist. The same schist forms a large cliff north of, and apparently above, the larger anomaly peak to the south. The two Ni-Co peaks are joined by an adjacent copper anomaly that, at the north end, can be attributed to thin layers of outcropping semi-massive sulphides within quartzite at the Road Showing. Grab rock samples indicate the layers are relatively high in gold (ranging from 0.17 - 0.46 g/t), copper (up to 0.1%), manganese and phosphate, but low in nickel and cobalt.

Northwest trending Cu-Zn-Co-Ni anomalies occur along the western and eastern margins of the soil grid. The stronger eastern anomaly ("East Zone") has the most anomalous copper, cobalt, and nickel outside of the Central Zone. Any outcrops within the anomaly remain to be mapped and sampled.

The West Zone is a two kilometre long, Cu-Zn ± Co-Ag anomaly open to the north, south and southwest.

Chip sampling of discovery outcrop with layer of semi-massive sulphide from the Ledgend discovery outcrop.

Sample of massive sulphide from the Ledgend discovery outcrop.

Sample of massive sulphide from the Ledgend discovery outcrop.

North Grid Soil Geochemical Maps

North Grid Targets: Hand Trenching

Current hand trenching and channel sampling is focused on defining sources for the soil anomalies within the North Grid. The central nickel-cobalt (“Ni-Co”) (“Central Zone”) anomaly is 800 metres in length, with the peak of the anomaly (values up to 0.84% Ni, 0.025% Co) located about 200 metres southeast of the massive sulphides boulders of the discovery showing. Three hand trenches spaced 100 metres apart have been completed so far on this target and vary from 0.5 to over 3 metres in depth. All trenches uncovered interlayered biotite, actinolite-tremolite, and talc-carbonate schist with disseminated sulphides. The actinolite and talc schists are altered remnants of high Ni-Co ultramafic rocks that intruded calcareous sedimentary rocks, and are interpreted as one probable source of the metals. Outcrop east of the end of the TR1000N comprises highly siliceous schist, with fine disseminated sulphides and common fuchsite, typical of exhalative horizons.

Clockwise from top left: fuchsite-coated siliceous phyllite from outcrop off east end of TR1000N, highly siliceous horizon in outcrop off east end of TR1000N (blue line marks channel samples), typical gossanous talc schist of the Central Zone.

Identical units were uncovered in trench TR1600N-1425, located about 500 metres to

the north of trench TR1000N. This indicates that favourable rocks of the Central Zone extend over 600 metres of strike length and confirm the soil sampling results.

Northwest trending Cu-Zn-Co-Ni anomalies occur along the western and eastern margins of the soil grid. Four trenches have been completed over the East Zone anomaly, which has the most anomalous copper, cobalt, and nickel outside of the Central Zone. Rock units comprise interlayered actinolite, muscovite-biotite and narrow talc schist, with sparse disseminated sulphides in a narrow unit of highly gossanous, calcareous quartzite.

Four trenches are planned along the West Zone, which is a two kilometre long, Cu-Zn ± Co-Ag anomaly along the northwest margin of the soil grid, open to the north and southwest.

North Grid UAV - Aeromagnetometry Survey

The pyrrhotite-bearing massive sulphides as exposed at the Discovery Showing were considered to be most easily traced in the subsurface with a magnetometer survey. Pioneer Aerial Surveys Ltd. (“Pioneer”) mobilized to the property in mid-June to fly approximately 90 line kilometres of aeromagnetometry, covering 375 hectares over the North Soil Grid. Pioneer used their UAV-MAG™ system, consisting of a multi-rotor UAV platform, a GEM Systems GSMP-35A potassium vapor magnetometer, and GEM Systems GSM-19 Overhauser base station. The survey flew east-west lines spaced at 50m with 500m perpendicular tie lines. Drone-flown magnetometer surveys have the advantage of low-flight speed, resulting in ultra-high-density resolution with the average station separation around 60cm at 10 m/s.

The survey generated plan maps of total magnetic intensity (“TMI”), analytical signal (“AS”), 1st vertical derivative (“VD”), and horizontal derivative (“HD”), as well as a 3D inversion and elevation sections through the 3D model. The AS map (see below) clearly shows a magnetic high associated with the Discovery Showing massive sulphide mineralization and underlying the hosting talc-carbonate schist exposed in trenches TR0900N to 1600N. The elevation slice at 900 m.a.s.l., or roughly 100m below the Discovery Showing outcrops and trenches, also indicates a magnetic high where sulphides (pyrrhotite + Ni-Cu-Zn sulphide) are thought to occur at depth.

The Central Zone magnetic anomaly extends over 500 metres farther south past TR0900N, to the southwest corner of the soil grid, merging with the West Zone soil anomaly. The West Zone also has a coincident magnetic anomaly at the north end, separated from the Central Zone anomaly by a northeast trending fault running along upper Ledgend Creek. Trenching is planned for this area.

Analytical Signal from the UAV-aeromagnetic survey, with thematic soil and rock Ni values

Total Magnetic Intensity (TMI), with thematic soil and rock Ni values

900m Elevation Slice of 3D Inversion of TMI, with thematic soil and rock Ni values

South Grid Anomalies

The South Grid, which covers one kilometre of the southern strike extension from the northern grid, generated a broad, 300 by 600 metre Ni-Co-Cu anomaly that is open to the south and west. Levels of nickel and cobalt are lower than the north grid, but the area is less steep and depth to bedrock is likely greater. This grid will be extended to the north and southwest in the next field season.

Lardeau

The Lardeau property comprises three claims totaling 5381 Ha along the west side of the Lardeau River, covering prospective Index and Jowett Formation rocks. The heavily vegetated area contains three B.C. RGS Ni-Co anomalies (95th percentile) and two lesser anomalies. Limited reconnaissance work along the access roads at Lardeau has identified listwanite float in the creeks with anomalous nickel silt samples. Listwanite is an alteration product of nickel-bearing ultramafic rocks, similar to the talc and actinolite schists found at Ledgend. Ultramafic rocks are also associated with the massive sulphides at the Standard showing. Most of the creeks are perpendicular to the dominant northwest trend of the geology and are ideal for detailed (200m spaced) silt sampling.

Cardero collected 123 samples in the fall of 2017. Three drainages returned highly anomalous Ni (>100 ppm), Co (>30 ppm) and Cu (>50 ppm) values, over up to three kilometres of their length. These areas will be further sampled with soil grids and outcrop mapping in spring 2018.

Tesla-Enerplus

The Tesla-Enerplus property comprises three claims totaling 551 Ha west of Gerrard, along Healy Creek. Mineral Mountain Resources in 2011 sampled banks along the logging road that follows the creek and discovered several horizons of black, manganiferous biotite schist with broad, weakly anomalous Ni and Co, as well and Cu and Zn (Assessment Report 32242). These horizons and sample locations were verified by the property owners in 2016. Cardero's prospecting and contour soil sampling (25m spaced) in fall 2017 along several logging roads on the west slope, above the Healy Creek road, have traced some of these horizons upslope, but more rock sampling and soil lines are needed. Only a few silt samples were collected, as the drainages run parallel to geological trends thereby limiting their usefulness.

The northern-most of the anomalous Co-Cu-Zn horizons extends for about 700 metres up the slope to above road exposures of rusty manganiferous biotite schist horizons within quartzite-biotite schist (Figure 3). 

A second Co-Cu anomaly at the south margin of the property appears to correlate to anomalous soil samples taken by Mineral Mountain along Healy Creek road 500 metres to the south. The claims were extended 1400 metres to the south to cover the anomaly. 

Cardero will follow up with more detailed soil and sediment sampling on the west and south areas of the property in the next field season. 

Spine

The Spine property consist of a single claim, 123 Ha in size, located 15 km northeast of Trout Lake on Spine Mountain, above treeline and with good rock exposure. Mineral Mountain Resources contour soil sampled in detail (5m spacing) the large orange and white gossans developed within black phyllite and obtained highly anomalous Cu, Zn, Au and Ni soil values. Peak values were 4119 ppm Cu, > 1% Zn, and 3678 ppm Ni along one line, and another had up to 703 ppm Cu, > 1% Zn, and 7244 Ni (Assessment Report 32242).

Cardero has not independently verified this sampling in the field but, based on reviewing the report, considers the samples were appropriately collected, assayed, and compiled following industry standards. Nonetheless, the results should not be relied upon.

Nico

The Nico property consist of a single claim, 245 Ha in size, located 25 km northeast of Beaton, B.C.. , and 1 km east of Mount Darling. Similar to Spine, it is located in the alpine and has good rock exposure. Detailed (5m spacing) soil sampling by Mineral Mountain in 2011 obtained anomalous Ni, Co, Cr and Cu associated with a narrow layer of argillite. The nickel appears to come from nickel arsenide.

Cardero has not independently verified this sampling in the field but, based on reviewing the report, considers the samples were appropriately collected, assayed, and compiled following industry standards. Nonetheless, the results should not be relied upon.

Sampling Procedures and Quality Assurance and Quality Control

The work program at the Kootenay Project was designed and supervised by M. McClaren, P.Geo., J.M. Dawson, P.Eng., and John Drobe, P.Geo., the Company's Chief Geologist. Soil samples were taken from the 'B' horizon whenever possible and were collected using a mattock or shovel. Sample sites were labelled with blue and orange flagging tape with the number recorded on the tape. Soil samples were placed in waterproof kraft envelopes, after which samples were dried and collated. All soil samples were then shipped in sealed bags to ALS Minerals laboratories in either Kamloops or North Vancouver, B.C. The samples were dried at <60 degrees C. and sieved to -180 microns (Prep 41), then analysed by ICP-MS for 51 elements (method AuME--TL43). 

This initial sampling program did not include a comprehensive QA/QC programme; however, ALS Minerals is an ISO 17025 registered laboratory and inserted blanks, standards and duplicates following their QA/QC protocol. In addition, follow-up field duplicate samples were collected from the anomalous soil lines, both high and low, and the results returned satisfactory values. 

Qualified Person

John Drobe P.Geo., Cardero's Chief Geologist and a qualified person as defined by National Instrument 43-101, has reviewed the scientific information that forms the basis for this news release, and has approved the disclosure herein. Mr. Drobe is not independent of the Company as he is an officer, a shareholder and hold incentive stock options.

Cautionary Note Regarding Forward-Looking Statements

Forward Looking Information: This webpage includes certain information that may be deemed "forward looking information". Forward-looking information can generally be identified by the use of forward-looking terminology such as "may", "will", "expect", "intend", "estimate", "anticipate", "believe", "continue", "plans" or similar terminology. All information in this release, other than information of historical facts, including, without limitation, the potential of the Kootenay project, general future plans and objectives for the Kootenay project, the availability of financing to the Company and the Company's plans in relation to exploration programs and exercising its options regarding the Kootenay project are forward-looking information that involve various risks and uncertainties. Although the Company believes that the expectations expressed in such forward-looking information are based on reasonable assumptions, such expectations are not guarantees of future performance and actual results or developments may differ materially from those in the forward-looking information. Forward-looking information is based on a number of material factors and assumptions. Factors that could cause actual results to differ materially from the forward-looking information include changes in project parameters as plans continue to be refined, future metal prices, availability of capital and financing on acceptable terms, general economic, market or business conditions, regulatory changes, delays in receiving approvals, and other risks detailed herein and from time to time in the filings made by the Company with securities regulatory authorities in Canada. Mineral exploration and development of mines is an inherently risky business. Accordingly, actual events may differ materially from those projected in the forward-looking information. For more information on the Company and the risks and challenges of our business, investors should review our continuous disclosure filings which are available at www.sedar.com. Readers are cautioned not to place undue reliance on forward-looking information. The Company does not undertake to update any forward looking information, except in accordance with applicable securities laws.

This webpage is not, and is not to be construed in any way as, an offer to buy or sell securities in the United States.
  

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