The Potlatch occurrence is located on a northwest trending ridge 6.0 kilometres northwest from Warsaw Mountain on the northeast side of Potlatch Creek.

The area is underlain primarily by metasedimentary rocks of the Hadrynian Horsethief Creek Group. For a more detailed description of the regional geological settings refer to the Warsaw Mountain occurrence (083D 041).

At least two generations of pegmatites occur in this area. Earlier generation pegmatites are concordant and boudinaged within enclosing pelitic schist units. Younger generation pegmatites crosscut layering and schistosity. Pegmatite dykes and sills in the area range from 0.90 to 9.0 metres in width, with thick pegmatites usually discordant. Orientations are also highly variable.

At the Potlatch occurrence, kyanite is present in pegmatites hosted in the Aluminous Pelite unit (Open File 1988-26) or equivalent Lower Pelite unit (Geological Survey of Canada Open File 2324) of the Horsethief Creek Group. The Aluminous Pelite or Lower Pelite unit consists of pelitic schist, quartzofeldspathic psammite, conglomerate with clasts of marble, calc-silicate rock, quartzite and granite, and concordant and discordant amphibolite.

All pegmatites are plagioclase-rich, typically consisting of 70 per cent plagioclase, 20 per cent muscovite and 10 per cent quartz. Plagioclase is often strained and well twinned (Mitchell, 1976). Kyanite crystals are found in a pegmatite matrix of quartz and mica and in surrounding pelitic schists.