The Sydney Inlet magnetite occurrence is located on the western shore of Sydney Inlet, approximately 700 metres south east of the entrance to Stewardson Inlet.
The area is underlain by granodioritic rocks of the Jurassic Island Plutonic Suite (Geological Survey of Canada Map 1537A).
Locally, a thin band of amphibolite striking south west is in contact with the intrusive rocks. The unit is approximately 200 metres wide and is part of the Paleozoic to Mesozoic West Coast Complex. The banded amphibolite is dark green to black in colour and consists of amphibole, plagioclase and magnetite. Selected samples assayed between 9.91 and 14.33 per cent iron (Assessment Report 462).
In 1962, Paco Resources completed a program of geological mapping on the area.