The Steel 2 occurrence is located approximately 11.7 kilometres south-southeast of the Shasta occurrence (094E 050), about 270 kilometres north of the community of Smithers.

The Steele 2 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.

Permian Asitka Group crystalline limestones are the oldest rocks exposed in the region. They are commonly in thrust contact with Upper Triassic Stuhini Group andesite flows and pyroclastic rocks. Stuhini volcanics have been intruded by the granodiorite to quartz monzonite Black Lake Suite of Early Jurassic age 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.

Exposures of predominantly Stuhini Group andesite and tuffaceous sediments are abundant around the Steel 2 showing. The aphanitic, medium grey, massive andesites are crosscut by 2- to 10-millimetre-wide quartz-carbonate veins. These veins strike 025 degrees and dip vertical. Near the contact between Stuhini Group rocks and porphyritic granodiorite to quartz monzonite of the Early Jurassic Kemess pluton, finely disseminated pyrite and magnetite are associated with epidote-chlorite alteration and rare localized stockwork quartz veinlets 1 to 2 millimetres in diameter.

In 1987, a sample with chalcopyrite and malachite was taken from a quartz-carbonate vein, 7 to 10 centimetres wide, in Stuhini Group andesite; assay results were 0.33 per cent copper, 5.4 grams per tonne silver and 3.25 grams per tonne gold (Assessment Report 17452).

In 1987, preliminary prospecting, geology and geochemical evaluation was carried out on the Steel claims by Skylark Resources Ltd. A total of 34 soil, 23 stream sediment and 20 rock samples were taken.