The Chip occurrence is located approximately 7.5 kilometres south-southeast of the Shasta occurrence (094E 050), about 280 kilometres north of the community of Smithers. The showing lies within the Omineca-Cassiar mountains at the southern end of the Toodoggone gold camp. The showing is situated within a Mesozoic volcanic arc assemblage which lies along the eastern margin of the Intermontane Belt, a northwest-trending belt of Paleozoic to Tertiary sediments, volcanics and intrusions bounded to the east by the Omineca Belt and to the west and southwest by the Sustut and Bowser basins.

Devonian-Permian Asitka Group crystalline limestones are the oldest rocks exposed in the region. They are commonly in thrust contact with Upper Triassic Takla Group andesite flows and pyroclastic rocks. These Takla rocks have been intruded by plutons and other bodies of the mainly granodiorite to quartz monzonite Early Jurassic Black Lake Suite and are in turn unconformably overlain by or faulted against Lower Jurassic calcalkaline volcanics of the Toodoggone Formation (Hazelton Group).

The dominant structures in the area are steeply dipping faults which define a prominent regional northwest structural fabric trending 140 to 170 degrees. In turn, high angle northeast-striking faults (approximately 060 degrees) appear to truncate and displace northwest-striking faults. Collectively these faults form a boundary for variably rotated and tilted blocks underlain by monoclinal strata.

The Chip showing is underlain by granodiorite of the Black Lake stock (part of the Black Lake Suite). To the east these intrusive rocks are in fault contact with predominantly augite plagioclase phyric andesite of the Takla Group. To the west, exposures of polymictic conglomerate, sandstone, shale and carbonaceous mudstone comprise the Middle-Upper Cretaceous Sustut Group.

Mineralization consists of a 200-metre long gossan heavily mineralized with pyrite. Mafic dikes have intruded what appears to be a fault crosscutting the entire length of the gossan. Rock sampling of this gossan produced generally poor assays. In 1987, samples 106518 and 106519, however, did yield assay values of 2.4 grams per tonne silver and 0.30 and 0.34 gram per tonne gold, respectively (Assessment Report 16371).

In 1987, a regional program consisting of geologic mapping, multipole induced polarization and geochemical sampling was conducted on behalf of Toodoggone Gold Inc. to review and analyze the data gathered across the Tom, Chip and Dale claims.