Blue Lagoon Resources Inc. Encounters 11.02 Gpt Au and 2.31% Cu over 5.65 Meters Within 5.49 Gpt Au and 1.21% Cu over 16.55 Meters in A Major Step-Out Hole on the Boulder Vein. Historical airborne geophysics indicated the presence of two moderate to strong linear conductors in the vicinity of the mineralization. Two drill holes (DM-22-258, and -262) were completed but no comparable mineralization was encountered in either drill hole.

Drill hole DM-22- 262 did encounter anomalous mineralization near top-of-hole, related to the historical near-surface 9800 Zone mineralization. This is represented by graphitic limy sediments with pyrite, sphalerite, galena, arsenopyrite and chalcopyrite mineralization. The massive sulphide horizon remains unexplained and does not appear to persist in any significant extent either in strike or dip based on the structural information collected to date and is not an immediate priority for follow-up drilling Diamond drilling was undertaken in the Federal Clearcut area to investigate a linear magnetic feature as well as an EM anomaly defined by the 2020 airborne geophysical survey.

Four drillholes (DM-21-192, -194, -196, and -198) were collared to test an EM/mag anomaly from the upper part of the clearcut (Federal EM target). The remaining holes were drilled to test the linear magnetic feature that roughly parallels Federal Creek (Federal Clearcut target). Federal Creek was interpreted to be a surface expression of a structural feature, likely a fault.

A strong EM anomaly to the west was also evaluated by the westernmost hole, hole DM-21-202. In the area of drilling along Federal Creek, the geology drilled can broadly be divided into an upper package of volcaniclastics underlain by a distinctive, strongly sheared, graphitic argillites and mudstones, further underlain by additional courser grained siltstones to sandstones (likely of volcanic origin), and finally underlain by coarser volcaniclastics. Moderate to strong shearing is present through these other lithological units.

Drilling to date suggests stratigraphy is shallow dipping toward the south. Sulphide mineralization is prevalent through much of the entire drilled lithologies but is best developed in the graphitic argillites and attendant veins, and in brecciated lithic tuffs above the argillite, also cut by quartz-carbonate +/- sulphide veins. Pyrite is the dominant sulphide present.

The mineral assemblage and depositional environment suggest a sedimentary-exhalative environment. Position of a local intrusive and apparent widespread sulfide mineralization/alteration in the Federal area will remain a target for follow-up at a later date.