McFaulds Lake Project - Ontario

Opportunity: High-grade nickel-copper sulphide deposits hosted within the Ring of Fire, a recently discovered, mantle-derived ultramafic intrusion that is also prospective for layered chromite deposits and platinum group metals (PGM).

Size and Location: The 13-claim block property covers 169 units situated in the McFaulds Lake area, within the James Bay Lowlands of northern Ontario.
Exploration Programs: The first phase of exploration at the joint venture property will include surface exploration guided by the results of a recent airborne geophysical survey. The goal is to discover mineralization similar to that discovered in 2007 by Noront Resources at its Double Eagle Property, which is widely considered to be one of the most significant grassroots discoveries made in Canada in recent years. Noront drilled 27 holes totaling 5,047 meters during its first full exploration season, with one of the best holes returning 117 meters grading 4.1% nickel, 2.2% copper, 2.1 grams platinum and 7.1 grams palladium per tonne, starting at 7 meters below surface. In order to direct its resources to in-the-ground exploration programs in the highly prospective Ring of Fire district of Ontario, Lund Gold has terminated its option and related payments to maintain the Carneirinho gold project in Brazil.

Ownership: Lund can acquire a 50% interest from Noront Resources Ltd. by funding $3.5 million of exploration expenditures over a three-year period. Once this interest is earned, the partners will form a joint venture management committee to further explore and develop the property.

Exploration Expenditures: $3.5 million over three years to earn a 50% interest, which includes a minimum of $1.0 million for a first-phase program in 2008. Lund Gold has completed a $2.5 million financing to fund the first phase of the proposed work program and review other potential acquisition opportunities.

Geology: The conceptual model for ongoing exploration in the Ring of Fire district is based on a mantle-derived, ultramafic intrusion emplaced along the margin of a regional-scale granodiorite pluton that intruded into and caused a doming of the host Sachigo greenstone belt rocks. On a global basis, ultramafic intrusions similar to the Ring of Fire intrusion are known to host nickel-copper deposits, layered chromite deposits and platinum group metals.