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Exploration and Evaluation Assets

6 Months Ended

Jun. 30, 2018

6.	EXPLORATION AND EVALUATION ASSETS

	Canada						US		Greenland
	Post Creek Property		Halcyon Property		Quetico Claims		Section 35 Property		Maniitsoq Property		Total
Acquisition
Balance, December 31, 2017		278		214		-		6		36		534
Acquisition costs – cash		5		4		40		2		15		66
Balance, June 30, 2018		283		218		40		8		51		600

Exploration
Balance, December 31, 2017		1,138		187		-		-		48,635		49,960
Administration		-		-		-		-		260		260
Corporate social responsibility		1		-		-		-		1		2
Environment, health & safety		-		-		-		-		29		29
Property maintenance		-		-		1		-		18		19
Drilling		5		-		-		-		1,150		1,155
Camp operations		-		-		-		-		1,116		1,116
Helicopter charter aircraft		-		-		-		-		1,268		1,268
Geology		15		10		9		-		307		341
Geophysics		-		-		1		-		339		340
Infrastructure		-		-		-		-		13		13
Technical studies		-		-		-		-		7		7
		21		10		11				4,508		4,550
Balance, June 30,2018		1,159		197		11				53,143		54,510
Total, June 30, 2018		1,442		415		51		8		53,194		55,110

	Canada				US		Greenland
	Post Creek Property		Halcyon Property		Section 35 Property		Maniitsoq Property		Total
Acquisition
Balance, December 31, 2016		268		206		3		20		497
Acquisition costs – cash		5		4		3		16		28
Balance, June 30, 2017		273		210		6		36		525

Exploration
Balance, December 31, 2016		1,085		173		-		36,587		37,845
Administration		-		-		-		208		208
Corporate social responsibility		-		-		-		12		12
Environment, Health & Safety		-		-		-		40		40
Property maintenance		-		-		-		7		7
Drilling expenses		-		-		-		805		805
Camp operations		-		-		-		744		744
Helicopter charter aircraft		-		-		-		783		783
Geology		34		2		-		293		329
Geophysics		1		-		-		250		251
Technical studies		-		-		-		47		47
		35		2		-		3,189		3,226
Balance, June 30, 2017		1,120		175		-		39,776		41,071
Total, June 30, 2017		1,393		385		6		39,812		41,596

The following is a description of the Company’s exploration and evaluation assets and the related spending commitments:

Post Creek

On December 23, 2009, the Company executed a letter of intent whereby the Company has an option to acquire a mineral claim known as the Post Creek Property located within the Sudbury Mining District of Ontario.

On April 5, 2010 and as amended on March 12, 2013, the Company entered into an option agreement to acquire a 100% interest in the Post Creek Property, subject to certain net smelter return royalties (“NSR”) and advance royalty payments. To December 31, 2015, the Company has completed the required consideration and acquired its interest in the Post Creek Property. Commencing August 1, 2015, the Company is obligated to pay advances on the NSR of $10 per annum, totalling $10 during the year ended December 31, 2017, the total of which will be deducted from any payments to be made under the NSR. The total advances paid during the six months period ended June 30, 2018 were $5, (June 30, 2017 - $5).

During the six months period ended June 30, 2018, the Company incurred exploration expenditures totalling $21 (June 30, 2017 - $35) on the Post Creek Property.

Halcyon

On April 5, 2010 and as amended on March 12, 2013, the Company entered into an option agreement to acquire rights to Halcyon Property, subject to certain NSR and advance royalty payments. To December 31, 2015, the Company has completed the required consideration and acquired its interest in the Halcyon Property. Commencing August 1, 2015, the Company is obligated to pay advances on the NSR of $8 per annum, totalling $8 during the year ended December 31, 2017, the total of which will be deducted from any payments to be made under the NSR.

During the six months period ended June 30, 2018, the Company incurred $14 (June 30, 2017 - $6) in exploration and license related expenditures on the Halcyon Property.

Quetico

During the six months period ended June 30, 2018, the Company acquired 757 claims known as Quetico located within the Sudbury Mining District of Ontario. The Company incurred total acquisition and exploration related costs of $51 for the six months period ended June 30, 2018 (June 30, 2017 - $nil).

Maniitsoq

The Company has been granted certain exploration licenses, by the Bureau of Minerals and Petroleum (“BMP”) of Greenland for exclusive exploration rights of an area comprising the Maniitsoq Property, located near Ininngui, Greenland. The Property is subject to a 2.5% NSR. The Company can reduce the NSR to 1% by paying $2,000 on or before 60 days from the decision to commence commercial production.

At the expiration of the first license period, the Company may apply for a second license period (years 6-10), and the Company may apply for a further 3-year license for years 11 to 13. Thereafter, the Company may apply for additional 3-year licenses for years 14 to 16, 17 to 19 and 20 to 22. The Company will be required to pay additional license fees and will be obligated to incur minimum eligible exploration expenses for such years.

The Company may terminate the licenses at any time; however, any unfulfilled obligations according to the licenses will remain in force, regardless of the termination

Future required minimum exploration expenditures will be adjusted each year on the basis of the change to the Danish Consumer Price Index.

During the six months period ended June 30, 2018, the Company spent in aggregate of $4,523 in exploration and license related expenditures on the Maniitsoq Property, (June 30, 2017 - $3,205).

Sulussugut License

(All references to amounts in Danish Krones, “DKK” are in thousands of DKK)

Effective August 15, 2011, the Company was granted an exploration license (the “Sulussugut License”) by the BMP of Greenland for exclusive exploration rights of an area located near Sulussugut, Greenland. The Company paid a license fee of $6 (DKK 31) upon granting of the Sulussugut License. The Sulussugut License was valid for 5 years until December 31, 2015, with December 31, 2011 being the first year. The application for another 5 year term on the Sulussugut License was submitted to the Greenland Mineral Licence & Safety Authority (MLSA) which was effective on April 11, 2016, with December 31, 2017 being the seventh year.

To December 31, 2015, under the terms of the preliminary license, the Company completed the exploration requirements of an estimated minimum of DKK 83,809 (approximately $15,808) between the years ended December 31, 2011 to 2015 by incurring $26,116 on the Sulussugut License. The accumulated exploration credits held at the end to December 31, 2015, of DKK 100,304 can be carried forward until 2019. Under the terms of the second license period, the Company had no minimum required exploration for the year ended December 31, 2016. As of December 31, 2017, the Company has spent $44,937 on exploration costs for the Sulussugut License.

To December 31, 2017 and 2016, the Company has completed all obligations with respect to required reduction of the area of the license.

During the year ended December 31, 2017, the Company had approved exploration expenditures of DKK 85,094 (approximately $16,746) which results in the total carried credits for the Sulussugut License at DKK 246,507 (approximately $48,513).

During the six months period ended June 30, 2018, the Company spent a total of $3,628 in exploration and license related expenditures, (June 30, 2017 - $2,868).

Ininngui License

Effective March 4, 2012, the Company was granted an exploration license (the “Ininngui License”) by the BMP of Greenland for exclusive exploration rights of an area located near Ininngui, Greenland. The Company paid a license fee of $6 (DKK 32) upon granting of the Ininngui License. The Ininngui License was valid for 5 years until December 31, 2016, with December 31, 2012 being the first year. The Ininngui License is contiguous with the Sulussugut License.

To December 31, 2016, the Company’s expenditures exceeded the minimum requirement and the Company has a surplus of DKK 15,677 (approximately $3,044) and the Company was granted a credit for the excess, which may be used towards future expense requirements on the Ininngui License until the following years; year 2018, DKK 2,276, year 2019, DKK 6,790 and year 2020, DKK 9,367, and should the Company be granted an extension on the exploration license.

The required minimum exploration expenditures on the Ininngui License for year 5, ending December 31, 2016 was DKK 2,715 (approximately $535). As of December 31, 2017, the Company has spent $3,698 on exploration costs for the Ininngui License.

During the year ended December 31, 2017, the Company had approved exploration expenditures of DKK 9,367 (approximately $1,843) which results in the total carried credits for the Ininngui License at DKK 25,044 (approximately $4,929).

During the six months period ended June 30, 2018, the Company spent a total of $422 in exploration and license related expenditures, (June 30, 2017 - $321).

New Mineral Licenses

During the six months period ended June 30, 2018 the Company was awarded new mineral licenses over a highly prospective block of ground to the west of the Fossilik Intrusion in Greenland:

a) Ikertoq License

In March 2018, the Company was granted an exploration license (the “Ikertoq License”) by the BMP of Greenland for exclusive exploration rights of an area located near Kangeriussaq in West Greenland. The Company paid a license fee of $7 (DKK 31) upon granting of the Ikertoq License. The Ikertoq License is valid for 5 years until December 31, 2022, with December 31, 2018 being the first year.

During the six months period ended June 30, 2018, the Company spent a total of $36 in exploration and license related expenditures, (June 30, 2017 - $Nil).

Carbonatite License

In January 2018, the Company was granted an exploration license (the “Carbonatite License”) by the BMP of Greenland for exclusive exploration rights of an area located near Maniitsoq in West Greenland. The Company paid a license fee of $7 (DKK 31) upon granting of the Carbonatite License. The Carbonatite License is valid for 5 years until December 31, 2022, with December 31, 2018 being the first year.

During the six months period ended June 30, 2018, the Company spent a total of $437 in exploration and license related expenditures, (June 30, 2017 - $Nil).

Section 35 Property

On January 4, 2016, the Company entered into a 10 year Metallic Minerals Lease (the “Lease”) with the Michigan Department of Natural Resources for an area covering approximately 320 acres. The terms of the Lease require an annual rental fee at a rate of US $3.00 per acre for years 1-5 and at a rate of US $6.00 per acre for years 6-10. The Company shall pay a minimum royalty at a rate of US $10.00 per acre for the 11^th year onwards, with an increase of an additional US $5.00 per acre per year up to a maximum of US $55.00 per acre per year. A production royalty of between 2% - 2.5% is payable from production of minerals and/or mineral products from an established mining operation area. The Company paid the first year rental fee and the required reclamation deposit of $14 (US $10). The Department of Natural Resources shall annually review the level of the reclamation deposit and shall require the amount to be increased or decreased to reflect changes in the cost of future reclamation of the leased premises.

During the six months period ended June 30, 2018, the Company spent a total of $2 in license related expenditures, (June 30, 2017 - $3).