The KR 1 showing, 70 kilometres north-northeast of Haines, Alaska, was discovered in 1983 as a result of high gold values in panned silts. The Klehini River property is subdivided into two groups. This occurrence is in claim block KR 1 of the Beta Group. The occurrence is found between the Hubbard Fault and Denali Fault system of the Alexander Terrane. The area is underlain by complexly deformed, generally Paleozoic rocks. Locally, thermal metamorphism, resulting from the Oligocene Tkope River Intrusion, includes develop- ment of a hornfels texture, silicification, skarn mineralogy and re- crystallization. Quartz veining is restricted to the intrusion and probably formed from volatiles released at a later stage of the in- trusion. In this area the intrusion is a fine to medium-grained hornblende diorite with many large xenoliths of recrystallized wall- rock.

Veining consists of narrow, branching, poddy veins of highly sheared, friable, brecciated, hematite and limonite stained quartz in a sheared and clay altered diorite. The veins contain very minor disseminated pyrite, chalcopyrite, malachite, azurite and a black, manganiferous stain on fractures. They appear to occupy fault zones. The clay alteration appears to be of a tectonic derivation. The sheared and brecciated nature of the vein indicates there has been post vein movement on the fault.

The average vein thickness is about 0.45 metres. Of the two veins which comprise this occurrence, one strikes about 135 degrees with a dip of about 50 degrees to the north. The other vein does not have a measureable strike but also dips to the north.

The best assay from the quartz veins are 119.98 grams per tonne gold, 45.94 grams per tonne silver and 0.0322 per cent copper. The altered and sheared diorite wallrock have a best assay result of 1.20 grams per tonne gold, 1.37 grams per tonne silver and 0.0022 per cent copper (Assessment Report 14210).