Claim Conversion

Sample of Prospector Letter - Notice to convert

Date:

Dear NB Claim Holder

Early in January 2010, The New Brunswick Government intends to implement a new on-line map staking system (NB e-Claims) for the Province. This new claim acquisition system is based on a predefined New Brunswick grid and will require the conversion of existing ground staked claims to conform to the new format. The legal authority necessary to proceed with the conversion required changes to the Mining Act and this was completed as of October 1, 2009.

The conversion procedure is intended to be primarily a volunteer process with a significant period of time offered to arrive at a satisfactory adaptation to the new system. However, it is recognized that there must be a point in time where all conversions are completed. At this time, it is the Recorder's intent to ask the Government to enact, no later than January 1, 2012, those sections of the Act that will end the volunteer conversion process. After this time the Recorder shall, within 90 days convert all remaining ground staked mineral claims to map staked mineral claims and register them accordingly.

The voluntary conversion process begins on October 5, 2009 and requires an application (Application to Convert Ground Staked Claims to Map Staked Mineral Claim Units) to be submitted, a copy of which is enclosed with this letter. Guidelines to complete the form, as well as, the form itself are available on the Department of Natural Resources Minerals website www.gnb.ca/0078/minerals/index-e.aspx.

Thank you for your attention to this request. If you require any assistance or additional information, please contact Beth Fowler at 506 444 2678.

Yours truly,

Ron Shaw, Recorder

Attachments: Application Form and Guidelines

Guidelines to submit Application to Convert

All Prospectors are advised of the following:

• The Recorder's Office will accept applications for the conversion of ground staked claims to map staked claims commencing on September 13th, 2009
• Section 48.8(1) of Bill 76 - An Act to Amend the Mining Act states the following:

The Recorder shall, within 90 days after the commencement of this section, convert all ground staked mineral claims to map staked mineral claims and register in the registry the map staked mineral claims in accordance with this section and any regulations.

It is currently the Recorder's intention to have the above noted section of the Act proclaimed no later than January 1, 2012.

Any ownership functions such as splitting, renewing, transferring, or grouping of these claims are to be completed in the usual manner. Do not use the conversion form for any of the aforementioned functions.

Any ground staked claims to be converted will be subject to the Business Rules as attached to this Guideline and the following:

• All ground claims to be converted will be converted as complete Blocks
• A map at a scale of 1:50,000, or more detail, indicating the units you have selected to be converted must accompany each conversion application form
• All ground staked claim groups that border other ground staked claim groups must be converted before any groups are updated on the Recorder's Office maps
• If your claims are not free standing* your application form as well as the adjacent claim holder's form must be received in the Recorder's Office before the conversion can be completed and recorded on the claim map
• Any additional claims that you acquire as a result of the conversion, will attract fees on the next renewal date

* None free standing claims share a boundary with claims owned by another claim holder(s)

The Application to Convert Ground Staked Claims to Map Staked Mineral Claim Units is provided on the Minerals and Petroleum website Forms page.

Voluntary Conversion Process:

Once the Recorder or his designate receives the request, and has confirmed that it is complete, one of the following should occur:

1. The Recorder or his designate will agree with the request as submitted and will mail back to the Claim Holder, an approval letter and map showing the new map staked units being acquired.

OR

2. If the Recorder or his designate has an issue with the application form as submitted, he or his designate will contact the Claim Holder to discuss the situation. When an agreement is reached*, then the Recorder will send a letter to the Claim Holder confirming the submission and approving the request as agreed to. The approval letter and map showing the new map staked units being acquired will then be mailed.

Prospectors are reminded that once the appropriate sections of the Act are proclaimed the Recorder can, within 90 days, convert all ground staked mineral claims to map staked mineral claims and register the claims in the registry as map staked mineral claims.

* This may require a re-submission of the application

Basic business rules are required to facilitate conversion of ground staked claims (old mineral tenure system) into map claim units (new mineral tenure system). The rules are intended to be fair to all right holders and also to give an incentive to switch to the new tenure system.

Busines Rules

The following are the business rules for conversion of ground staked claims (hereby called ground claims) into map claim units (hereafter called claim units) as defined by the New Brunswick Minerals and Petroleum Grid.

1. Each conversion will be based on the area covered by a claim group and not the area of individual ground claims, unless the group only comprises a single claim. The existing claim group number will be carried forward and associated with the new group of claim units. There will not be a one to one relationship between individual ground claims and individual claim units. The location of each claim group, as portrayed on the appropriate 1:50,000 claim map, will be assumed to be correct unless otherwise suggested, and proved, by the right holder.

2. A claim unit entirely inside a claim group will be assigned to that claim group.

3. A claim unit partially inside a claim group and adjoining open ground will be assigned to that claim group. The right holder will be given the option to keep or drop the whole claim unit.

4. A claim unit partially inside a claim group but adjoining another claim group held by the same right holder will be assigned to one or the other claim group at the choice of the right holder.

5. A claim unit covering adjoining claim groups with multiple right holder(s) will be deemed in 'multi-held' and will be subject to the following rules:

a) Each right holder whose ground claims fall inside the same single claim unit will be deemed to be a right holder of that claim unit in part.

b) Each right holder will have the right to conduct mineral exploration up to the ground claim boundary within the claim unit as represented on the 1:50,000 claim map.

c) Any 'open' areas associated with a 'multi-held' claim unit will not be available to a right holder or new map staking.

d) Once a 'multi-held' claim unit has only one right holder due to other right holders dropping the right, then the whole claim unit will automatically cede to the remaining right holder, or if all right holders surrender their ground based claims falling within a multi-held claim unit then that claim unit will be available for map staking.

e) Right holders will have to meet work requirements of a full claim unit, and be charged renewal fees for a full claim unit, even though they may only be a part owner of a 'multi-held' claim unit. (This is an incentive for right holders to drop unnecessary ground based claims in disputed areas and reduce administration of transition claim units.)

6. A claim unit that includes a boundary of an area withdrawn from staking, a mining lease, or other mineral exploration agreement can be assigned to a right holder however the right holder shall only have the mineral exploration rights up to the boundary as represented on the 1:50,000 claim maps or if such boundary is legally defined. Such a claim unit shall be treated as a full claim unit for work requirements and renewal purposes.

Free Standing Groups

Group #4636 has 4 ground claims and no claim holders bordering their original ground staked group.

Scenario I

Group #4636 is entitled to select any yellow 'buffer zone' units as the new map staked locations.

Ex: Group #4636 chooses 5 units to convert.

• Grid 2621, Section 014, Unit D, E
• Grid 2621, Section 024, Unit A, H, I

Previous ground claims totaled 4 and they chose to overlay 5 units. They do not owe for the 5th unit until the renewal date.

Scenario II

Group #4636 may select up to 25 units. They chose 24.

• Grid 2621, Section 013, Unit M & N
• Grid 2621, Section 014, Unit C, D, E, F, K, L, M, N
• Grid 2621, Section 023, Unit O, P
• Grid 2621, Section 024, Unit, A, B, C, F, G, H, I, J, K, N, O, P

Bordering Groups - Not touching

Groups that do not 'touch' may still have to negotiate the buffer unit.

Scenario III

Group 1550 & 3367 have to decide who wants section 057, unit N and section 058, unit C.

Buffers include the unit the original ground staked claim touches as well as the adjacent unit. (1 +). With this example, there is no clear adjacent buffers therefore, the unit that solely touches a buffer unit, has that buffer option first. If the claim holder chooses not to use that buffer unit, the buffer unit is now available to the adjacent claim holder using the 1+ method.

Ex: If group 3367 decides to move south and does not want section 057, unit N, O or P, these units can be selected by group 1550 as they are in their natural buffer zone. Group 1550 cannot select beyond their natural buffer zone.

So, if group 3367 either lets their claims expire or converts to section 057, unit A-H then holders of group 1550 could select only the top units of section 057. Units I, J, K, L are not in their natural buffer zones.

Bordering Groups

Using the plotted NTS ground staked DNR maps, groups that look like they touch. This assumes plotted claims are correct.

Scenario IV

If group 4694 and 4699 are the same claim holder, they will only have to select which units are assigned to which group #.

If groups have different claim holders, then they will negotiate to determine who will have title to individual units.

Before conversion can proceed, both holders must submit an Application to Convert Ground Staked Claims to Map Staked Mineral Claim Units.

In the event that negotiations fail and no decision is forthcoming prior to January 1, 2012, the Recorder is mandated to decide who is assigned the units and will convert the claims within the allotted 90 days.