The Muchalat Inlet area is underlain by granodiorite of the Jurassic Island Plutonic Suite and amphibolite grade metamorphic volcanic and sedimentary rocks of the Upper Paleozoic to Lower Mesozoic West Coast Complex.

The Shannon occurrence is located about 2.0 kilometres from a granodiorite batholith of the Jurassic Island Plutonic Suite. Mineralization is reported to occur both as a 1.5 metre wide vein and as replacement in limestone along a hornblende-feldspar porphyry or volcanic contact (Minister of Mines Annual Report 1928, page C373).

Mineralization strikes 130 degrees and dips 70 degrees east, and consists of over 15 to 20 per cent (estimated) sphalerite, minor galena and massive chalcopyrite. A sample assayed trace gold, 225.9 grams per tonne silver, 8 per cent lead and 13 per cent zinc (Minister of Mines Annual Report 1928, page 373). Mineralization has been traced intermittently over 1200 metres by hand trenching.

The geological description is similar to that of the Silverado and Baltic showings (092E 017 and 092E 026).