IDAHO-MARYLAND PROJECT SUMMARY LOCATION OWNERSHIP HISTORY PERMITTING GEOLOGY AND MINERALIZATION EXPLORATION GOLD RESOURCES HISTORIC MINING PRACTICES PROPOSED MINING METHODS INFRASTRUCTURE MINE WASTE MANAGEMENT PROJECT BENEFITS QUALIFICATION OTHER PROJECT LINKS CAUTIONARY NOTE TO U.S. INVESTORS

Project Overview Presentation March 2012 Exploration Targets and Resource Blocks Idaho-Maryland Mine Photos Idaho-Maryland Maps Idaho-Maryland 2002 Technical Report 2004 Technical Report 2009 Technical Report Idaho-Maryland Mine Project Draft Environmental Report www.idaho-maryland.com

SUMMARY

The Idaho-Maryland Project (the "I-M Project") is located on the edge of the City of Grass Valley, California, in the western foothills of the Sierra Nevada Mountains. The Idaho-Maryland Mine was originally discovered in 1851 and operated from 1862 until 1956. It was historically California's second largest producing underground gold mine, with total recorded gold production of 2.4 million ounces at an average recovered grade of 0.43 ounces per ton. It is situated within the Grass Valley Mining District, which was historically one of the richest gold districts in North America, producing over 17 million ounces of gold. The mine is located 60 miles northeast of Sacramento, California and 90 miles west of Reno, Nevada.

Historic Idaho-Maryland Mine Site (No. 1 Shaft)

Historic New Brunswick Mine Site (New Brunswick Shaft)

Existing Idaho-Maryland Mine workings consist of 72 miles of tunnels with the lowest level developed to a depth of 3,280 feet below surface. The Idaho-Maryland Mine includes workings from 5 historic mines including, Eureka, Idaho-Maryland, Brunswick, Union and South Idaho Mines. Historic mining methods included shrinkage and square set mining, while processing included gravity, flotation, and cyanidation of ore. The Idaho No. 1 Stope within Idaho-Maryland Mine was one of the richest bonanza grade ore shoots in the world, producing one million ounces of gold from one million tons of ore, for an average grade of one ounce per ton.

The historic Empire Mine, which was California's largest gold mine, is located adjacent to the Idaho-Maryland Mine. It produced 5.8 million ounces of gold from the years 1850 to 1956. The Empire Mine was Newmont Mining Corporation's first operating mine and Newmont still owns the mineral rights there. The Empire Mine had 350 miles of tunnels and the lowest level developed was over 5,000 feet below surface in 1956. In a three mile radius of the Idaho-Maryland Mine, over 13 million ounces of gold were produced from hardrock mines in the area.

The Idaho-Maryland Mine currently has an NI 43-101 compliant measured resource of 212,000 ounces of gold (1.10 million tons at 0.21 opt), an indicated resource of 259,000 ounces of gold (0.56 million tons at 0.48 opt), and an inferred resource of 1,002,000 ounces of gold (2.57 million tons at 0.39 opt) -- See Emgold 2009 Technical Report for details. The Idaho-Maryland deposit has significant exploration potential and is potentially a world class mineral deposit. Emgold management believes the exploration targets at the mine have potential for the delineation of 3 to 5 million ounces of gold (subject to dewatering and additional underground exploration). Note that this target is conceptual in nature and there has been insufficient exploration to define a mineral resource. It is uncertain if further exploration would result in the target being delineated as a mineral resource.

Emgold is in the process of completing an Environmental Impact Report (EIR) for the IM-Project, which will cover the dewatering, exploration, redevelopment, operation, and closure of the mine. The City of Grass Valley is the Lead Agency for the EIR process and will be responsible for certifying the EIR as complete. The City will then need to approve a Conditional Mine Use Permit for the Project, after which Emgold can obtain the necessary ancillary permits and entitlements to reopen the mine. The permitting process in California is comprehensive and well defined.

Upon completion of permitting and obtaining the necessary financing, Emgold would dewater the historic mine workings, excavate new underground accesses, and conduct exploration necessary to convert the existing mineral resources into mining reserves. A feasibility study would be completed and, assuming positive results, the mine would then be brought into production. The mine will initially be phased into production at 1,200 tons per day and then possibly expanded to 2,400 tons per day, with gold production at these tonnage rates expected to be about 120,000 ounces of gold per year and 200,000 ounces per year respectively. Conventional underground mining and gold processing methods will be applied. Project environmental protection measures would include a cyanide destruction plant and water treatment plant. The Project will include unique additions such as an Education Center and Outdoor Mining Display Park to enhance tourist opportunities for the City of Grass Valley.

Rendering of Proposed Idaho-Maryland Mine Site

Rendering of Proposed Idaho-Maryland Site from Whispering Pines Drive

Emgold has an extensive community relations program in Grass Valley. This has included public meetings on the Project and presentations to stakeholder groups. Emgold has set up a booth at local events to answer questions about the Project, address concerns from the public, and make improvements to the Project.

In an independent public opinion poll commissioned by the City of Grass Valley City Counsel, of 388 randomly selected residents, 72 percent of those responding residing in the City are in favour of reopening the historic Idaho-Maryland Mine if appropriate environmental safeguards are in place. Only 12 percent of those polled indicated they may not support the mine's reopening. The purpose of the independent telephone survey, conducted in 2006, was to better understand local development issues and the relationship with municipal growth in the City.

I-M Staff and Supporters take part in the 4th of July Parade

The I-M Project will clean up a legacy mine site that has set idle for over 50 years. The Project is supported by Dan Logue, State Assemblyman, and Tom McClintock (United States Congressman) because of the benefits it will bring to Grass Valley, Nevada County, and the state of California. Those benefits include:

• Brownfield redevelopment of three legacy mine sites;



• Smart Growth with infill development, compact design, mixed land use, walk-ability, transportation choices, preservation of open space, development towards existing communities, and enhancement of the community;



• Sustainable development, including the three pillars of economic development, social development, and environmental protection;



• Use of a green recycling technology to eliminate the need for surface tailings impoundments and waste dumps typically associated with a gold mine;



• Smart energy use by combining a gold and industrial mineral mine, gold processing facility, aggregate processing facility, and recycled stone and ceramics plant into one single facility, greatly reducing energy requirements of separate, stand-alone operations;



• Clean up of historic mine tailings on the Idaho-Maryland site (listed as a California Envirostor site);



• Elimination of existing untreated mine water discharge into Wolf Creek;



• Preservation of Maidu history, the history of the California Gold Rush, the Idaho-Maryland Mine, and famous people associated with the Idaho-Maryland Mine through the Mining Education Center;



• Preservation of mining culture including the contribution of Cornish miners, Chinese miners, and other groups that helped develop Grass Valley through the Mining Education Center;



• Public education about the mining industry and its history, technology, equipment, etc. through the Mining Education Center and Outdoor Mining Historical Display Park;



• Support of community including non-profits, special interest groups, charities, sports teams, etc. through contributions including financial support, supply of materials and equipment, or through participation of mine employees;



• Support of community organizations such as the police and fire department through contributions including financial support, supply of materials and equipment, or through participation of mine employees;



• Creation of 500 direct permanent high paying jobs at full operation;



• Creation of 291 direct temporary high paying jobs at peak construction;



• High paying wages and benefits that flow through the community;



• Diverse job opportunities for professions, trades, equipment operation, and both skilled and unskilled labor;



• Youth employment (both graduate and non-graduate);



• Training programs to improve worker's skills;



• Direct opportunities for businesses to provide goods and services to the mine -- purchase of fuel, concrete, hardware supplies, safety supplies, administrative supplies, use of hotels, use of restaurants, purchase of insurance, banking, heath, and other services, etc.;



• Indirect opportunities for businesses to provide goods and services to employees of the ine -- housing purchases and rentals, purchase of food, cloths, hardware supplies, appliances, insurance services, banking services, use of restaurants, use of movie theatres, etc.;



• Economic diversity for the City of Grass Valley and Nevada County, including and increased an solid tax base (property tax, sales tax, etc.);



• Traffic improvements including a connector road between Idaho-Maryland Road and East Bennett Road (in the City of Grass Valley's 2020 General Plan) and realignment of Springhill Drive, Idaho-Maryland Road, and Centennial Drive Intersections (a major safety improvement);



• Installation of a Nevada Irrigation District potable water system for residents along East Bennett Road;



• Provision of a Mining Education Center and Outdoor Mining Display Park to promote tourism for the City of Grass Valley, Nevada County, and the State of California;



• An improved job/housing balance for the City of Grass Valley and Nevada County;



• Redevelopment of the project sites for industrial or business park use at the end of the project, bringing benefit to the City of Grass Valley, Nevada County, and the State of California after the mine closes;



• Funding of California's Abandoned Mine Reclamation Fund at $5.00 per ounce of gold produced by the mine; and



• Tax revenue for California, and the United States (sales tax, corporate income tax, etc.).

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The I-M Project is located on the eastern edge of the City of Grass Valley, Nevada County, California in the western foothills of the Sierra Nevada mountain range. The City of Grass Valley has a population of about 12,000 people. Nevada County has a population of approximately 97,000 people. Grass Valley has a rich gold mining history and much of the tourism in the City today is based on a historic gold mining theme.

Downtown Grass Valley, California

Location Map Grass Valley, California

Grass Valley is located about 60 miles northeast of the City of Sacramento, CA. Road access is excellent to the property, and is accomplished by taking Interstate 80 east to Auburn, CA and travelling about 33 miles north on Highway 49 to Grass Valley. Direct road access to the Idaho-Maryland Mine properties is via Idaho-Maryland Road or New Brunswick Road, both main exits off Highway 49. Grass Valley is also located 90 miles west of Reno, NV, and is accessed from Reno by taking Interstate 80 west to Highway 20, traveling west on Highway 20 for 30 miles to Grass Valley and taking the Main Street exit to Idaho-Maryland Road. Driving time from Sacramento to the Project is one hour, and from Reno is 1.5 hours.

Airport access is excellent via the Sacramento International Airport or Reno-Tahoe International Airport. Alternative airports include San Francisco International Airport or Oakland International Airport. There are airports in both Grass Valley and Auburn that can be used by small planes.

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OWNERSHIP

• 37 acres of surface rights centered around the New Brunswick shaft (New Brunswick site);



• 102 acres of surface rights west of the historic Idaho #1 Shaft (Idaho-Maryland site); and



• 7 acres of surface rights centered around the Round Hole Shaft (also known as the Idaho #2 shaft).

Jack Clark at the Round Hole Shaft, 1941	Gold In Quartz - The Legendary Idaho-Maryland Mine by Jack Clark To order Gold In Quartz, contact Comstock Bonanza Press, Grass Valley, CA (530) 263-2906
Grass Valley Cornish Choir singing underground at the New Brunswick Shaft, Christmas Eve, 1940. Broadcast world wide over the NBC Red Radio Network and BBC. The Choir was formed in the 1870s and continues to perform.
Men Going Underground at the Idaho#1 Shaft Famous local picture, recently incorporated into the mural, "Mine Shift" by artist John Pugh on the Del Oro Theatre in Grass Valley, California.

The 102 acres of surface rights collectively named the Idaho-Maryland site, includes a 56 acre parcel and an adjoining 45 acre parcel lying immediately to the east. The 7 acres at the Round Hole site is in the process of being purchased by IMMC and the 56 acres at the Idaho-Maryland site is currently owned by IMMC. The 37 acres at the New Brunswick site and 45 acres at the Idaho-Maryland site are owned by private individuals referred to as the BET Group and subject to a lease and option to purchase agreement between the BET Group and IMMC.

The mineral rights controlled by Emgold comprise portions of Sections 19, 29, 30, and 31 in T16N R9E and portions of Sections 23, 24, 25, 26, 36 in T16N R8E. The majority of the mineral rights are defined as sub-parcels in a Quit Claim Deed and are restricted to a variable depth from surface. In general, the rights are contiguous below 200 ft from surface. Emgold's lease and option to purchase agreement with the BET Group includes about 2,750 acres of mineral rights in addition to the surface properties outlined above.

Idaho-Maryland Project Mineral Claim and Surface Rights Map

In 2005, through its subsidiary IMMC, Emgold acquired 100 percent of the 30 acres of underground mineral rights adjacent to the BET Group mineral rights. These properties consist of the Golden Gate West and Golden Gate East claims, and the remaining interests in the Dana and Christopher Columbus Claim that the Company did not already own (see Emgold March 2, 2005 News Release). The Idaho-Maryland property thus consists of approximately 2,780 contiguous acres of mineral rights either owned or subject to a lease option to purchase agreement with the BETS Group.

The lease option to purchase agreement with the BET Group was originally signed in 1993 and revised in 2002. The agreement was extended by two years in 2007, a further 2 years in 2009, and a further 2 years in 2011. The lease portion of the agreement expires in February 2013, assuming it is not further extended. At that time, the purchase part of the agreement commences, and the property can be purchased over a four year period. . The expected purchase price in 2013 is estimated to be approximately US $6.15 million. Lease payments in 2010 and 2011 are $30,000 per quarter.

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Gold was discovered on the Idaho-Maryland property and the original claim staked in 1851. High-grade gold mineralization was discovered in 1861 and mining started in 1862. All production during this time was from a single vein referred to as the Idaho Number 1 Vein. Production from 1862 to 1893 produced 1.0 million ounces of gold from 1.0 million tons of ore. Fire destroyed the Idaho mine hoist in 1894, which caused the lower mine workings to flood. The period from 1894 to 1914 saw intermittent gold production (approximately 75,000 ounces).

The claims around the deposit were consolidated in 1915 to form the Idaho-Maryland Mine. Metals Exploration Company of New York acquired control of the property, dewatered the mine, deepened the Idaho shaft to 2,000 feet and moved the Union Hill stamp mill to the Idaho shaft area. Full production, however, was never achieved (only 27,000 ounces gold recovered). Control over the property changed in 1926 when Errol MacBoyle and Edwin Oliver created holdings that included the Idaho-Maryland, Brunswick, and Morehouse Mines. Production commenced the same year.

Errol MacBoyle played an important role in the development of the Idaho-Maryland Mine. He was a Mining Engineer and was able to consolidate a number of smaller mines together, redevelop them, and make them efficient and profitable. Errol MacBoyle built the Grass Valley Airport (1934) and utilized a Lockheed Electra to transport gold from the mine to the mint in San Francisco. MacBoyle acquired and built the Loma Rica Ranch in Grass Valley where he bred race horses, had orchards, and raised cattle. MacBoyle donated the land for where the Grass Valley Memorial Hospital is built and also contributed funds for its construction and operation.

Errol MacBoyle, Mine Engineer
Entrepreneur and Philanthropist

From 1926 to 1942 the Idaho Mine produced 650,000 ounces of gold from 1.1 million tons of ore. The Brunswick Mine restarted production in 1934 after deepening its shaft to 3,460 ft and constructing a 750 t/d mill. Production from 1934 to 1955 consisted of 810,000 ounces of gold from 3.6 million tons of ore.

Idaho-Maryland Mill and Cyanide Plant

New Brunswick Mill Site

The mines were closed in 1942, due to the enactment of the Federal War Production Boards Limitation Order L-208, and were reopened again in 1945. Errol MacBoyle, who had a stroke in 1943 and became a semi-invalid, lost control of the company in 1945. When the mine reopened in 1945, production was hampered by depleted operating funds, rising labor and supply costs, skilled labor shortages, and negligible exploration and underground development work. The gold price remained fixed by the U.S. government at $35 per ounce and gold mining ceased in 1954 and was briefly replaced by government-subsidized tungsten production until 1956. The mine eventually became uneconomic to operate and shut down in 1956 due to the fixed price of gold at U.S. $35 per ounce along with increased labor and supply costs that developed following World War II. By then the mine had workings to a depth of 3,280 feet. Mining activity stopped altogether in 1957 and equipment from the mine was auctioned off.

At the time of closure, the mine was owned by Idaho-Maryland Industries, Inc. In 1963 Idaho-Maryland Industries executed a Quit Claim Deed to William and Marian Ghidotti. Ownership of the mineral rights eventually passed to the BET Group in 1983.

Emperor Gold Corporation (Emperor), a publicly listed Canadian junior exploration company (and predecessor to Emgold) became involved in the property in 1993. The prior project included dewatering and ore exploration activities at the Idaho-Maryland Mine which were proposed to occur from the New Brunswick site and use the adjacent Sierra Pacific Industries, Inc. property as part of the infrastructure for the project. After completion and certification of the Final Environmental Impact Report for that project in October 1995, the County approved the project and issued to Emperor a Conditional Use Permit (CUP) in January 1996.

Emperor changed its name to Emgold Mining Corporation in August 1997. In 1999, with a continuing decline in the price of gold, the Company temporarily abandoned the project until gold prices recovered. Then, in 2002, Emgold re-negotiated the mineral and property rights to the IM Project with the revised agreement with the BET Group, and formed IMMC.

More recent exploration at the I-M Project conducted over the period of 1993 through to 2009 has consisted of an extensive geologic evaluation program and surface core drilling. This geologic data evaluation program was possible because of the excellent and comprehensive preservation of the historic Idaho-Maryland mine and mill records. This data is exhaustive and essentially complete, and was used to generate a consistent, property-wide structural geology model and vein set definition and chronology.

The available key historic data consists of:

• 3,200 mine maps and drawings, including 1,257 linen maps (1" = 50 ft assay plans, geology plans and stope plans, 1" = 100 ft geologic cross-sections), with exploration drill hole geology and assays plotted;



• 1,100 photographs (surface and underground);



• monthly development reports for 1921 to 1956);



• monthly geological summary reports for 1936 to 1942);



• eight ledgers of development and stope sampling assays );



• assay reports of diamond drilling, channel samples, and muck car samples);



• general manager's and mine superintendent's reports for 1947 to 1953); and



• mill production reports and cost summaries for 1934 to 1956.

Emgold is currently completing a 3-D model of the historic mine, historic stopes, and ore zones. This model will be used to estimate mineral resources and eventually ore reserves based on geostatistical analysis. This model currently contained over 36,000 historic assays.

Proposed Redevelopment of the Idaho-Maryland Mine

Idaho-Maryland remains the second-largest historical underground producer of gold in California. It produced a total of 2.4 million ounces of gold from 5.5 million tons of ore, for an average recovered grade of 0.43 ounces of gold per ton.

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Mining projects in the U.S. are strictly regulated and have to go through a stringent permitting process. The permitting process is well defined in California and the process is not significantly different from the permitting process anywhere else in North America.

The proposed I-M Project is being permitted under the California Environmental Quality Act (CEQA, 1970). Under CEQA the Project needs to be evaluated for potential environmental impacts and, as part of that analysis, measures to mitigate any potential impacts are developed as well as potential alternatives to the proposed project that could mitigate potential environmental impacted.. In addition, the proposed Project involves disturbance to the ground surface during the operation, and so a reclamation plan will need to be prepared for the Project in accordance with the Surface and Mining Reclamation Act (SMARA, 1975). Emgold has submitted a draft Reclamation Plan to the City for review and approval. The City of Grass Valley is the Lead Agency in the EIR and SMARA process.

The CEQA process for the I-M Project includes three steps:

• Master Environmental Assessment (completed June 2006);



• Initial Study (completed September 2007); and



• EIR Preparation (commenced October 2007 and ongoing).

A Draft EIR was completed on October 2008. The public review process for the Draft EIR was completed in January 2009. Emgold, after reviewing the Draft EIR and public comments, elected to make modifications and clarifications to the Project Applications for the IM-Project. In April 2011, IMMC submitted Revised Project Applications to the City, which were accepted by the City in May 2011. Based on the modifications and clarifications in the 2011 Revised Project Applications, IMMC requested that a Revised Draft EIR will be prepared to ensure analysis of the modifications and clarifications in the EIR process and also to ensure public comment on the same. In June 2011, the City commenced a competitive bid process to select a new consultant to complete the EIR process and also commenced a competitive bid process to retain specialist consultants to advise the City through the EIR process. These bid processes were completed by the City in November 2011. Subsequently, with a scope of work, budget, and schedule now defined to complete the EIR process, IMMC requested time from the City to raise sufficient capital to complete the EIR process. Due to poor market conditions for raising capital for junior mining companies through 2012, IMMC continued to keep the permitting process on hold. In September, 2012, due to this delay, the City elected to deem IMMC's 2011 Revised Project Applications withdrawn and requested that IMMC resubmit them when it has sufficient funds in place to move forward. It is expected completion of the EIR will take about 12 months from this funding being put in place.

After completion of the Final EIR and certification of the EIR as complete, the City of Grass Valley will be required to grant (or not grant) a Conditional Use Permit for the mine. This permit will outline any conditions under which Emgold must operate.

The I-M Project will also require a number of entitlements that will need to be approved by the City of Grass Valley. These include:

1. A General Plan Amendment,

2. Zoning Amendments, and

3. Annexation of certain properties into the City from Nevada County.

In addition, a Development Agreement will be negotiated between IMMC and the City of Grass Valley. This Development Agreement will outline responsibilities of IMMC and the City for development of the Project.

The I-M Project will also require a variety of local, state, and federal operating permits. These will be obtained once the Final EIR is complete and the Conditional Use Permit is issued for the mine.

More information on CEQA, SMARA, Clean Air Act (CAA, 1970), and the Clean Water Act (CWA, 1972) can be found on these websites:

Master Environmental Assessment can be found at:

The Initial Study can be found at:

The Draft Environmental Impact Report can be found at:

The City of Grass Valley's website on the I-M Project can be found at:

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GEOLOGY AND MINERALIZATION

Regional Geology

The I-M Project is a structurally controlled, mesothermal gold deposit situated in the northern portion of the Sierra Nevada Foothills Gold Belt. This belt averages 50 miles in width and extends for 320 miles in a north-northwest orientation along the western slope of the Sierra Nevada range.

The rock units underlying the Idaho-Maryland mine property include early Jurassic meta-sediments of the Fiddle Creek Complex; early Jurassic meta-volcanics and interflow sediments of the Lake Combie Complex; middle Jurassic ophiolitic assemblage of the Spring Hill Tectonic Mélange; later Jurassic Tectonic Mélange of the Weimar Fault Zone; and late Jurassic dioritic intrusives. The most important of these units for gold exploration is the Spring Hill Tectonic Mélange.

Regional-scale structures also provide important controls for mineralization on the property. The shape of the Idaho-Maryland gold ore deposit is controlled by the regional-scale Weimar Fault and the district-scale Spring Hill Tectonic Mélange Zone. Furthermore, the Weimar Fault is considered to be the source conduit for the gold-bearing fluids for the Idaho-Maryland deposit.

Regional Lithological Units

Property Geology Map

Emgold developed a comprehensive geological model for the I-M Project which was reviewed by Stephen Juras, PhD, P.Geo, Qualified Person for AMEC, in 2002 and again in 2004. The property hosts a structurally controlled deformation zone terminated at its eastern end by the regional Weimar Fault. Within this deformation corridor, large dismembered clasts of predominantly ophiolitic igneous origin are present in a foliated serpentinite mélange matrix (Spring Hill Tectonic Mélange unit). These large clasts are referred to as slabs in Idaho-Maryland company reports. Identified slabs consist of albitized (sausserite) meta-gabbro, massive antigorite serpentinite, meta-diabase, meta-diorite, slates, and basaltic to dacitic meta-volcanics. The largest slab of metavolcanic rocks on the property is the Brunswick Slab, which is 1.5 miles in length, approximately 0.6 miles in width, elongated in an eastward direction, and open at depth. This slab is interpreted to be derived from the Lake Combie Complex. All of the significant gold production from the Idaho-Maryland Mine was localized within the matrix and tectonic slabs of Spring Hill Mélange unit. Gold production in the New Brunswick Mine occurred primarily in the Brunswick Slab.

Brunswick Slab Plan View

The varying styles of mineralization present at the Idaho-Maryland Project are typical of those commonly found in mesothermal lode gold deposits worldwide. At least four basic types of mineralization have been recognized to contain significant gold deposits. In order of importance, these include (1) gold-quartz veins, (2) mineralized black slate bodies, (3) mineralized diabasic slabs, and (4) altered, mineralized ultramafic schists. The veins consist primarily of quartz, which is milky white, massive to banded, sheared, and brecciated. Gold occurs as native gold, ranging from very fine grains within the quartz to leaves or sheets along fractures.

Idaho-Maryland and Brunswick Mine Veins - Plan View Showing Brunswick 2300 Mine Level

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EXPLORATION

The Grass Valley Mining District has been the most productive gold area in the State of California. The mines in the district were known in California as the "Northern Mines" because they were not considered part of the Mother Lode Gold Belt. The first and second largest underground gold producing mines in the state, the Empire and Idaho-Maryland, are located within this mining district and are adjacent to each other. The Empire Mine produced 5.8 million ounces from 1850 and 1956 and had workings exceeding 5,000 feet vertically in depth.

The Idaho-Maryland Mine gold exploration programs were reviewed by Stephen Juras for AMEC in 2002 and 2004. The initial program consisted of an extensive geologic evaluation of the historical mine records plus surface diamond core drilling, made possible by the excellent and comprehensive preservation of the historical Idaho-Maryland mine and mill records. This data was used to generate a consistent, property-wide structural geology model and vein set definition and chronology. Unmined mineralization was identified along underground workings and in historical diamond drill holes. Interpretation of the updated geologic model defined new vein sets and extensions of known vein sets. These were categorized for mineral resource estimates, future exploration, and expansion. Emgold implemented many of the recommendations outlined in both AMEC reports when project funding was available.

The database to support the Idaho-Maryland mineral resource estimate contains over 36,000 gold assays, the majority of which were taken from underground samples (mostly channel samples) as part of the historic operations. Those from diamond drill holes comprise only a minor portion of the assay database. The assay data reside as handwritten entries on assay plans (1 inch = 50 ft) for all mine levels along with a small number recently found in log books. Drillhole assay data accompany the intercepts on these plan maps, and copies of assay certificates also are present for the final 10 years of production.

The historic samples were fire-assayed at former mine site laboratories. No records exist of any historic QA/QC program. Sample quality was inferred by the reconciliation of historic production records to underground sample data. These studies, as well as an investigation on mill-to-resource prediction verified by AMEC showed that the resource or reserve estimates consistently underestimated the amount of gold produced by milling, a discrepancy most likely reflective of sample size influence rather than laboratory technique. High nugget value deposits with coarse gold areas are best sampled with large sizes, which was not common practice at the time. Therefore, it was concluded that any estimates made using this historic data should include comparisons with values unadjusted and adjusted for the regular underreporting of grade (i.e., "call factor").

In 2002, Juras stated that the comprehensive set of assay plans, supported by records of muck car stope samples and mapped geology data, as well as the detailed historical production records, all support the integrity of the assay data for the Idaho-Maryland project. These data were deemed suitable for use in mineral resource estimation. Juras also checked data transcription onto assay plans from copies of original assay certificates and from assay plan to mineral resource worksheets and concluded that the data are sufficiently free of error to be adequate for resource estimation.

In 2003-2004 surface exploration drilling programs were conducted to test the geologic model and explore the veins of the Idaho-Maryland Mine. The methods and results were reviewed by Juras for AMEC and disclosed in their 2004 report.

Since 2004, Emgold has continued evaluate the property geology and model historic data using MineSight(r) software. The surface geology of the property was mapped and computerized for use in geologic modeling. The historic assay database was computerized to use in geostatistical modeling and further delineation of mineralized zones. A stope model of the location and shape of historic stopes was also completed. This information will be utilized in the next phase of work along with the vein model, which is in progress and not yet complete.

Also since 2004, new gold exploration blocks were delineated and announced in News Releases by Emgold dated April 2, 2007 and April 11, 2007. These were exploration targets that did not meet all the criteria of resources but would be areas of potential exploration. A cutoff grade of 0.10 oz/ton Au was used to define these targets. No additional drilling has been conducted since the 2003-2004 surface drilling programs. Work since 2007 has consisted of entering, analyzing, and modeling historic data.

Idaho-Maryland Mine Project Exploration Targets

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GOLD RESOURCES

In 2002, the gold mineral resources for the Idaho-Maryland property were estimated using traditional longitudinal sections and 3-D geologic models with commercial mine planning software. Juras validated the evidence for the pertinent vein/structural interpretation data support and consistency. All examples based on the underground data demonstrated good data back-up and sound projection limits. The interpretations covering the drillhole intercepts also were felt to be sound and reasonably projected. However, the latter is hampered by the uncertainty in spatial location of the drillhole intercept due to the holes not having been down-hole surveyed. Juras also checked numerous resource blocks for correct tabulation of sample values, reasonable projection limits, and volumetric and trigonometric calculations, and stated that the checked blocks were properly constructed and calculated. Specific criteria were established for mineralized blocks to be classified as resources. Those included: a) minimum true thickness of three feet for resource blocks, b) cutoff grade of 0.1 opt Au, c) mine call factor not applied to any blocks developed from muck car samples or drillholes (historic or recent), and d) mineral resources outlined by single drill hole intercepts as Inferred Resources.

In 2004, the gold mineral resource for the Idaho-Maryland property was increased slightly. The estimate used the same criteria that had been previously established and disclosed. Juras again reviewed the results for AMEC.

In 2007, the gold mineral resource was increased by approximately three percent. This estimate also used the same criteria that had been previously established and disclosed. This most recent resource increase was announced in an Emgold News Release dated March 1, 2007.

The Idaho-Maryland Mine currently has an NI 43-101 compliant measured and indicated resource of 472,000 ounces of gold at a grade of 0.28 opt and an inferred resource of 1,002,000 ounces of gold at a grade of 0.39 opt (see Emgold's 2009 Technical Report). The Idaho-Maryland deposit has significant exploration potential and is potentially a world class mineral deposit. Emgold management believes the exploration targets at the mine have potential for the delineation of three to five million ounces of gold (subject to dewatering and additional underground exploration). Note that these potential ounces are conceptual in nature and there has been insufficient exploration to define them as a mineral resource at this time. The estimate is based on estimated historic tons per vertical foot mined and historic grades, and projecting that potential tonnage at depth.

Idaho-Maryland Project Mineral Resource Summary, March 1, 2007

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Links to Technical Reports on the Idaho-Maryland Project are below:

Emgold is currently completing an updated resource estimate that will incorporate three dimensional modeling of veins, mineralized vein areas, and mineralized stockwork areas around the veins. This model will utilize geostatistical modeling techniques and be much more comprehensive than previous models. The new resource estimate will also be based on recent gold prices, which are significantly higher than the $375 per ounce price used in past analysis.

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HISTORIC MINING PRACTICES

The "million ounce" stope in the Idaho No. 1 Vein was mined between 1862 and 1893. Shrinkage and square set mining was used to extract the ore. The Brunswick mine had much better ground conditions, and the primary mining method was shrinkage stoping. At Brunswick, the stopes were developed by drifting on ore for their entire length, and then draw raises were developed upwards for approximately 20 feet and coned out to connect them together. Chutes were installed in the raises to load ore directly into the mine cars. Where ground support was required within the stopes, small pillars were left in place or strategically placed timber posts were used. Flat-lying stopes were mined using the room-and-pillar method, and scraper hoists were used to transport ore to the track drift horizon.

The New Brunswick, Round Hole and Idaho-Maryland No. 1 shafts were the primary shafts at the two mines. The New Brunswick vertical shaft was 3,460 feet deep. This shaft provided access to the Idaho-Maryland's 34 working levels. The Round Hole shaft was a vertical, 5 foot diameter circular shaft, core-drilled to a vertical depth of 1,125 feet. This shaft was used for ventilation and to transport men and mine supplies, and is thought to still be open. The Idaho-Maryland No. 1 Shaft was an inclined shaft that is no longer accessible.

Most access drifts were 5 feet x 7 feet in cross-section, while the main haulage drifts were 6 feet x 8 feet. Hoisting is reported to have been accomplished with 6-ton skips.

Sand tailings were placed underground in the New Brunswick Mine as hydraulic backfill. Between the years 1946 and 1950 over 100,000 tons of hydraulic sand backfill was deposited in the New Brunswick Mine. The backfill was used to fill various open stopes so that overlying ore could be accessed and mined. Stope productivity was reported to be low, on the order of 3 tons to 4 tons per shift.

Mucking Machine Operator

Locomotive Operator Hauling Ore

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PROPOSED MINING METHODS

Proposed mining methods include shrinkage, cut-and-fill, room-and-pillar, longhole, and vertical crater retreat mining. While some shrinkage mining is possible, its use may likely be minimal due to the skill level of miner required for this type of mining. The majority of the mining may be done using cut-and-fill mining techniques to maximize grade and recovery of the ore. Longhole and vertical crater retreat mining could be used primarily in low grade, bulk tonnage zones. Room-and-pillar techniques may be used in flat lying zones.

The New Brunswick and Round Hole shafts would be used in future mining operations. The New Brunswick Shaft had three-compartments and was 3,460 ft deep. In 1991, the shaft was inspected throughout its entire length by remote underwater cameras and probes. The timbers appeared to be in reasonable condition, except for the sections above the waterline. A new production shaft may also be required.

Drill Jumbo

Load Haul Dump (LHD) Machine

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HISTORIC PROCESSING METHODS

Two mills were operated on the property in the 1930s through 1950s, the Idaho mill and the New Brunswick mill. Both incorporated crushing, grinding, gravity separation, sulfide flotation, and gold smelting/refining. The Idaho mill also had a cyanidation plant and Merrill-Crowe recovery circuit to treat flotation concentrates and sands from both mills.

Historical production records from the 1930s and 1940s indicate overall gold recoveries ranging from 93.8% to 97.2% using a combination of gravity, flotation, and cyanidation. Of the total gold produced during this period, recovery in the gravity circuit ranged from 61% to 69%. In the flotation circuit, recoveries ranged from 30% to 37%. Approximately 1.2% of the total gold recovered was through cyanidation of the sands. Gravity recovery methods used at the time included riffles, amalgamation plates and barrels, shaking tables, vanners, and jigs.

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METALLURGICAL TESTING

In 2006, preliminary gravity and cyanide tests were conducted using small samples of drill core rejects from the 2003-2004 surface drilling programs. These were composited into one sample and a gravity concentration test was performed. Results suggested that gold recoveries would be consistent with historic mill recoveries, which were above 95 percent. In 2006 and 2007, preliminary gravity, flotation and cyanide leach tests were conducted on small samples of historic mine tailings. Gravity results indicated that gold recoveries of up to 25 percent could be attained from pulverized historic tailings with much higher recoveries expected from fresh ore. The results of initial flotation tests on historic tailings suggested that 26 percent of the gold would be recovered. Cyanide soluble leach test results on the tailings varied from 41-53 percent.

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PROPOSED PROCESSING METHODS

The I-M Project is being permitted with the use of gravity, flotation, and cyanidation processes. Gravity concentrates may be produced using Knelson Concentrators or similar equipment. A flotation process can be used to remove additional gold not captured in the gravity process and a flotation concentrate would be produced. The gold may be removed from the gravity and flotation concentrates using intensive cyanidation. Gold bullion would be produced on site and sent to a refine for further upgrading and sale. A cyanide destruction plant would be constructed to ensure environmental compliance.

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INFRASTRUCTURE

The I-M Project has excellent road access directly to each of the three surface properties. There are also power lines, natural gas lines, drinking water lines, and sewer lines located adjacent to the Idaho-Maryland site where the majority of the infrastructure for the mine will be located.

MINE WASTE MANAGEMENT

PROJECT BENEFITS

Benefits of the I-M Project would include:

• Brownfield redevelopment of three legacy mine sites;



• Smart Growth with infill development, compact design, mixed land use, walk-ability, transportation choices, preservation of open space, development towards existing communities, and enhancement of the community;



• Sustainable development, including the three pillars of economic development, social development, and environmental protection;



• Use of a green recycling technology to eliminate the need for surface tailings impoundments and waste dumps typically associated with a gold mine;



• Smart energy use by combining a gold and industrial mineral mine, gold processing facility, aggregate processing facility, and recycled stone and ceramics plant into one single facility, greatly reducing energy requirements of separate, stand-alone operations;



• Clean up of historic mine tailings on the Idaho-Maryland site (listed as a California Envirostor site);



• Elimination of existing untreated mine water discharge into Wolf Creek;



• Preservation of Maidu history, the history of the California Gold Rush, the Idaho-Maryland Mine, and famous people associated with the Idaho-Maryland Mine through the Mining Education Center;



• Preservation of mining culture including the contribution of Cornish miners, Chinese miners, and other groups that helped develop Grass Valley through the Mining Education Center;



• Public education about the mining industry and its history, technology, equipment, etc. through the Mining Education Center and Outdoor Mining Historical Display Park;



• Support of community including non-profits, special interest groups, charities, sports teams, etc. through contributions including financial support, supply of materials and equipment, or through participation of mine employees;



• Support of community organizations such as the police and fire department through contributions including financial support, supply of materials and equipment, or through participation of mine employees;



• Creation of 500 direct permanent high paying jobs at full operation;



• Creation of 291 direct temporary high paying jobs at peak construction;



• High paying wages and benefits that flow through the community;



• Diverse job opportunities for professions, trades, equipment operation, and both skilled and unskilled labor;



• Youth employment (both graduate and non-graduate);



• Training programs to improve worker's skills;



• Direct opportunities for businesses to provide goods and services to the mine -- purchase of fuel, concrete, hardware supplies, safety supplies, administrative supplies, use of hotels, use of restaurants, purchase of insurance, banking, heath, and other services, etc.;



• Indirect opportunities for businesses to provide goods and services to employees of the ine -- housing purchases and rentals, purchase of food, cloths, hardware supplies, appliances, insurance services, banking services, use of restaurants, use of movie theatres, etc.;



• Economic diversity for the City of Grass Valley and Nevada County, including and increased an solid tax base (property tax, sales tax, etc.);



• Traffic improvements including a connector road between Idaho-Maryland Road and East Bennett Road (in the City of Grass Valley's 2020 General Plan) and realignment of Springhill Drive, Idaho-Maryland Road, and Centennial Drive Intersections (a major safety improvement);



• Installation of a Nevada Irrigation District potable water system for residents along East Bennett Road;



• Provision of a Mining Education Center and Outdoor Mining Display Park to promote tourism for the City of Grass Valley, Nevada County, and the State of California;



• An improved job/housing balance for the City of Grass Valley and Nevada County;



• Redevelopment of the project sites for industrial or business park use at the end of the project, bringing benefit to the City of Grass Valley, Nevada County, and the State of California after the mine closes;



• Funding of California's Abandoned Mine Reclamation Fund at $5.00 per ounce of gold produced by the mine; and



• Tax revenue for California, and the United States (sales tax, corporate income tax, etc.).

Core from the Round Hole Shaft Donated to
U.C. Davis Arboretum Project

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