The mineral deposits in the Guanajuato area are classic fissure-hosted lowsulphidation epithermal gold-silver-bearing quartz veins and stockworks. Economic mineralization consists of fine-grained disseminations of acanthite, electrum, agularite, and naumannite with accessory pyrite, and relatively minor sphalerite, galena, and chalcopyrite. Gangue minerals include quartz, calcite, adularia, and sericite. The veins are accompanied by hydrothermal alteration consisting of argillic, phyllic, silicic, and propylitic facies. Mineral textures in this zone are typically fracture-filling, drusy, and colloform masses.

For the period from July 31, 2014 to July 31, 2015 the Guanajuato Mine production tonnage was from Cata, Santa Margarita, Guanajuatito, San Cayetano, and Los Pozos. Mining was carried out six days per week and, at 214,836 tonnes, averaged 589 tonnes per calendar day during July 31, 2014 - July 31, 2015.

The Cata ore zones are being mined by mechanized cut and fill method. An access ramp is located in the hanging-wall from which cross-cuts are driven to access the ore at the various lift elevations. There are 1-boom, electric hydraulic jumbos for drilling, 3.5 and 4.0 - yard LHDs for mucking, and 10 and 18 - tonne trucks for ore haulage. Ground support in the stopes is installed using scissor lift trucks.

Los Pozos ore zones are being mined by mechanized cut and fill method. There is a ramp in the footwall which provides access to sublevels that are spaced approximately 35m apart. There are electric hydraulic jumbos for drilling, 3.5 and 4.0 - yard LHDs for mucking, and 10t trucks for ore haulage. Ground support in the stopes is installed using scissor lift trucks.

The Santa Margarita ore zones are being mined by mechanized cut and fill method. An access ramp is located in the hanging-wall from which cross-cuts are driven to access the ore at the various lift elevations. Drilling is carried out with hand-held jack-leg drills in the narrow sections and with 1-boom, electric hydraulic jumbos in the wider zones. Mucking is conducted by 2.0, 3.5 and 4.0 - yard LHDs and broken ore is trucked to the Cata shaft by 10 and 18 tonne trucks. Ground support in the stopes is installed using stopers or jack-legs and/or scissor lift trucks.

The Guanajuatito ore zones are being mined by mechanized cut and fill method. An access ramp is located in the hanging-wall from which cross-cuts are driven to access the ore at the various lift elevations. Drilling is carried out with hand-held jack-leg drills in the narrow sections. Mucking is
conducted by 2.0, 3.5 and 4.0 - yard LHDs and broken ore is hauled from the mine by 10 tonne highway trucks to the processing plant. Ground support in the stopes, grouted rebar, is installed using stopers or jack-legs.

Mine pre-production at San Ignacio started in the third quarter of 2013. A total of 55,236 tonnes of ore grading 120g/t Ag and 2.36g/t gold has been processed from 2,581 meters of ramp and level advance up to the end of the December, 2014.

The main ramp (4.5 by 4.5 meters) has a 12% decline. It was developed using a 6 cubic yard scoop, a single-boom electric jumbo, and a combination of conventional 20 tonne trucks and an underground truck.

The mining method is standard cut and fill with waste provided by the development. Jacklegs are used in stopes for vertical to 70 degree production holes, and if necessary the hanging wall can be blasted if needed for at least a 2.0 meter wide stope. Forced air ventilation uses electric fans, and sump pumps operate at 50 – 60gpm removing mine water. The two air compressors are electrical with 1,000cfm and 100psi. The mine’s electric power is supplied by the Mexican national grid.

There are two 12 hour working shifts operating from Monday to Saturday. There are 15 operators per shift, one supervisor per shift, plus one mine superintendent and one services crew of 5 persons (day shift only).

Mineralized rock is trucked to the Guanajuato Mine plant using conventional 20 tonne trucks.

Mineral feed from both the Guanajuato Mine and San Ignacio Mine are processed at the GMC metallurgical plant at the Guanajuato Mine.

The three stage crushing plant is designed to produce ball mill feed that is less than 3/8 inch in size. Run-of-mine ore is passed through a grizzly, into the 1,000 tonne coarse ore bin. Oversize is broken manually or with a backhoe-mounted rock-hammer. The coarse ore is minus 18 inches’ material. From the bin the ore is taken by an apron feeder and over vibrating grizzly to the Pettibone (24” by 36”) primary jaw crusher. The jaw crusher is set to four inches. There is also a second 500 tonne capacity coarse ore bin that feeds a separate, smaller crusher so that aterials can be kept separate if desired.

The jaw crusher product and the undersize from the vibrating grizzly is sent to the Symons (4 ft. standard head) secondary cone crusher, which further reduces the particle size to minus one inch. The secondary crusher product is conv ........