The principal mineral deposits in the Platosa area are high-temperature epigenetic silver leadzinc carbonate replacement deposits (CRD). The distal portions of these deposits are characterized by irregularly shaped pods, lenses, and roughly tabular or tubular masses of sulphide mineralization that can either cross-cut or run sub-parallel to the host stratigraphy. The near-vertical bodies are called chimneys, while the more horizontal and elongate masses are called mantos. Mantos and chimneys can extend for thousands of metres from the source of the mineralizing fluids and often follow tortuous paths through the host rocks. The distal massive sulphide bodies commonly grade progressively into mineralized metasomatic skarn deposits as source intrusions are approached. These intrusives are the ultimate source of CRD-type mineralization. This proximal mineralization includes skarns developed along fractures, along dyke and sill contacts, and as large irregular lenses on stock contacts. Locally, mineralized veins cut both the skarns and host intrusions. Metamorphic alteration (marbleization recrystallization, hornfels, and skarnoid) commonly occurs peripheral to the skarn zone. All aspects of CRD and skarn mineralization are locally and regionally structurally controlled. Important structural controls include faults, fractures, contacts, fold axes, and collapse (paleokarst) zones. Secondarily enhanced host rock permeability (i.e., fractures, breccias, solution cavities, dolomitization) is also an important controlling factor for mineralization (Megaw et al., 1988).

Mineralization at Platosa forms a series of mantos and chimneys localized at the intersection of the PSZ with a northeast striking lineament. As presently known, the bodies are found within an irregularly shaped 800 m by 700 m area. Most mantos dip gently to the east and are often connected by local, small chimney structures forming a stair-step pattern for a collective dip of 18º towards the east. Depth from surface ranges from 60 m in the west to over 315 m in the east. Sulphide mineralization is massive, banded, disseminated and fracture-filling, fineto coarse-grained galena and sphalerite, with minor accessory pyrite. The primary silver mineral is acanthite, which occurs as coarse blebs and fine-grained intergrowths with galena. Native silver and proustite occur locally. Silver, lead, and zinc grades are often high, especially in the more massive sections. Silver grades in the thousands of grams per tonne are not uncommon. Lead and zinc sulphides can constitute over 80% of the rock mass in drill core.

Drilling in the known manto area has also occasionally intersected anomalous copper and gold values, the gold occurring with the massive sulphides in several holes in the 6A Manto and in a siliceous/jasperoid zone overlying but some distance above portions of the NE1 Manto massive sulphides. Neither the copper nor gold is of sufficient continuity to be considered part of the Mineral Resource, however, its presence may be an indication of proximity to a mineralization plumbing system and this possibility is being studied. Gangue minerals include fine-grained calcite, coarse gypsum, quartz, and fluorescent purple fluorite.

Underground development has encountered several areas of lower grade, sulphide-rich breccias beneath and around many of the main sulphide bodies. These breccias are composed of coarse sulphide and wall rock fragments up to one metre in diameter, with interstices filled with loose to partially consolidated fine to coarse sulphide and dolomite sand. In many places, the infill shows the fine laminar bedding characteristic of cavern-fill sediments. These lowergrade zones may have formed through late intra-mineral to post-mineral dissolution of carbonate rocks around and below the mantos, with concurrent collapse of manto fragments and wall rocks into the voids, followed by later “washing” of finer-grained particles into the breccia voids by groundwater flow. Notably, the sand-sized fraction tends to be dominated by galena and/or acanthite and commonly yields high silver grades. In many places, these breccias are cross-cut and cemented by later gypsum deposition. Core recovery is often poor in the unconsolidated, sandier portions of these breccias.

A wide range of thermally metamorphosed rocks are found throughout the property. These include hornfels, skarnoid, and marble recrystallization of the carbonate host rocks. The heat source for the metamorphism is thought to be a polyphase intrusive body that may extend for several kilometres beneath the southwest flank of the Sierra Bermejillo. The extent of the body s revealed by regional aeromagnetic surveys flown by the Mexican Geological Survey and Excellon. Monzonite, granodiorite, granite, quartz-eye porphyry, and andesite porphyry have been found in isolated outcrops and drill holes throughout this area. Deeper holes drilled in this area have encountered copper-molybdenum-bearing veinlets and metasomatic skarn zones cutting the hornfels. Megaw (2002) postulated that these metamorphic and metasomatic fluids related to the deeper-seated portions of this intrusion were dammed below the relatively impermeable Lower Hornfels Formation and were only locally able to ascend into the upper carbonate units along faults and fractures.

Once a manto has been accessed, mineralized material is mined by a “Pilot and Slash” mining method, using jacklegs with some mining carried out using jumbos. Depending on the shape and orientation of the manto, the pilot heading can be inclined, declined or flat, to remain in mineralization. Several phases of back slashing (breasting), wall slashing, or floor slashing (benching) from the pilot heading may be required to extract all mineralized material. When larger openings are developed, rock bolting has been carried out or a pillar left for support until mining of the area has been completed. Mining to date indicates that the mantos are very irregular in shape and orientation, and are in many cases connected.

As the more steeply-dipping mantos are developed, portions of the mining will be carried out using mechanized cut-and-fill and shrinkage-type methods. The method used will be dictated by the conditions encountered during the development process.

For mechanized cut-and-fill, it is planned to drive primary stope accesses into the deposit on a -15% decline. After mining of each successive slice of ore, the stope is backfilled and the access backslashed to allow for mining of the next cut. This sequence is repeated up to five times until the stope access reaches an incline of +15%. Access to the next cut is then provided by a -15% stope access driven from a higher elevation. The LOM plan anticipates that the cut and fill stopes will be backfilled with unconsolidated development waste and this is the basis for mining productivity and operating cost estimates applicable to this method. Historically, Platosa has stored development waste underground in mined out stopes. It is planned to reclaim material from this source for use as backfill in the cut-and-fill method.

A significantly higher than normal number of mining faces is currently required to achieve production targets. This increased flexibility is required as headings can change classification from mineralized to waste from one round to the next or become unavailable due to unexpected water inflow requiring grouting. Implementation of the water management component of the Optimization Project will significantly reduce or eliminate delays caused by the unexpected water inflows component.

There is currently no mineral processing carried out at the Platosa site. ROM material is crushed to minus 3/8 inch on site and, since mid-March 2009, has been processed at the Excellon-owned flotation mill in the town of Miguel Auza located 220 km south of the mine. The mill operates a conventional grinding/flotation/filtration circuit producing separate silverlead and silver-zinc concentrates. It has the capacity to process approximately 350 tpd of the high-grade Platosa mineralization with size of the flotation circuit being the limiting factor. This capacity exceeds the current mine production rate and, as a consequence, the mill operates on a variable schedule of several days on then several days off depending on mine and shipping schedules. Certain maintenance activities are carried out on the days the mill is not operating in order to minimize disruptions.

Production is crushed (to minus 3/8 in.) and hauled by truck from the Platosa Mine to the crushed ore storage area (capacity of approximately 2,400 tonnes, or almost one full week of milling), adjacent to the Miguel Auza mill. The individual stockpiles are sampled as material is received so that blending can be performed thus providing a consistent mill feed grade. Mill feed is hauled by front-end loader to the fine ore hopper feeding the ball mill. Sodium cyanide is added to the ball mill feed to depress the zinc in the subsequent flotation circuit. The ball mill reduces the particle size to minus 400 mesh (minus 35 µm) and operates in closed circuit with a pump box feeding a bank of cyclones. Oversize from the cyclone underflow is returned to the mill for further grinding whereas the cyclone overflow product is sent to the flotation circuit.

The cyclone overflow is pumped to a conditioning tank where the pH is adjusted and lead circuit flotation reagents (collector and frother) are added. A silver-lead concentrate is produced from a bank of lead rougher and scavenger flotation cells. The concentrate is upgraded using both primary and secondary cleaning cells. The final silver-lead concentrate is then filtered to reduce the water content. The filtered concentrate is stored in a dedicated covered compartment prior to loading and haulage to the port by truck.

Tailings from the lead scavenger circuit is fed to a series of conditioning tanks where the pH is adjusted and copper sulphate is added to activate the zinc, previously depressed prior to the slurry entering the lead flotation circuit. Other flotation reagents are added as required. A silver-zinc concentrate is produced from a bank of zinc rougher and scavenger flotation cells. The concentrate grade is upgraded using both primary and secondary cleaning cells. The final silver-zinc concentrate is then filtered to reduce the water content. The filtered concentrate is stored in a dedicated covered compartment prior to loading and haulage by truck to the port.

Tailings from the zinc scavenger circuit are pumped to the tailings pond for final disposal. The tailings pond is located to the northwest of the mill.