The Kensington and Jualin deposits are located in the Berners Bay mining district which lies on the northern end of the Juneau Gold Belt, a 120 mile long, 10 mile wide structural zone containing numerous mesothermal gold deposits. The district is flanked by Triassic aged mafic metavolcanic rocks to the east-northeast and Cretaceous aged pelitic sediments to the west-southwest. The contact between these two units has been intruded by the northwest-trending, Cretaceous aged Jualin Diorite stock measuring approximately five miles long by three miles wide. Regional deformation and shearing within and adjacent to the Jualin Diorite has resulted in emplacement of numerous goldbearing, mesothermal quartz-carbonate vein deposits.

The Project area retains additional exploration potential, as many of the areas along the three district-scale structural trends (Comet, Orval, and Lion’s Head shear zones) that host numerous gold occurrences have received only limited modern exploration attention.

The deposits with economic significance exhibit two distinct habits:

1. High-grade shear-hosted veins of limited strike and dip length within a narrow halo of locally auriferous quartz-veined diorite, and

2. Vein packages comprised of extensional vein arrays, sheeted extensional veins, and stacked en-echelon shear veins.

Vein mineralization is characterized by gold and gold-silver telluride minerals with minor associated native gold. Most of the gold is contained in Calaverite (AuTe2) which occurs in association with native gold as inclusions in and interstitial to pyrite grains and in microfractures in pyrite. Trace amounts of petzite (Ag3AuTe2), coloradoite (HgTe) and altaite (PbTe) have also been noted. Minor amounts of chalcopyrite are also present along with trace amounts of bornite, molybdenite, sphalerite, galena, and pyrrhotite. The auriferous pyrite typically occurs in small to large blebs or clots within the quartz and quartz-carbonate veins.

The primary mining method at Kensington is transverse longhole stoping with paste backfill (40 ft. in width, nominal height of 75 ft., and variable lengths, from 25 ft. to 150 ft. exposure). Access ramps (16 ft. x 16 ft.) and level development (15 ft. x 15 ft.) are driven in the footwall or hangingwall of the orebody with twin boom jumbos, LHD (Load/Haul/Dump) loaders, and teledump low profile mine haul trucks. In transverse stoping, the ore is extracted by driving across the orebody on two levels, drilling and blasting with 60-80 ft. vertical rings of blast holes between the two levels at a width of 40-50 ft. and creating an open stope near perpendicular to the strike of the ore using Cubex and Simba longhole drills to break the rock in a bulk extraction method. Vertical raising within and outside of the orebody is done with the Cubex longhole drill in most instances. Where greater ground control, and dimension control is desired, a raisebore of the appropriate size is selected to pilot a hole between existing excavations and then back-reamed to the desired dimension. Typically raisebores are limited to escapeway scenarios, with the Cubex drop-raising all other vertical excavations. Approximately 5% of vertical development is attributable to ore/waste pass accesses, with the remainder going to ventilation raises. Future vertical development will begin including more excavations for ore/waste passes as Coeur advances into regions that do not have existing excavations to connect to, but which must be built in their entirety from scratch.

A minor amount of drift and fill mining has been done in Kensington Block E (Zone 41). Where a drift is driven (15 ft. x 15 ft.) parallel to the ore boundary, and within the structure until the vein is too narrow to economically drive on, then the remaining ore is either slabbed out of the drift walls or in the case of a wider portion of the ore on a given elevation, short headings are driven (15 ft. x 15 ft.) and filled with paste or CRF (Cemented Rock Fill). There is very little drift and fill in the current Mineral Reserves as most has been converted to narrow longitudinal stopes to limit the amount of lateral development, and improve extraction ratios. Options remain open to employ this method again in the future depending on circumstances and morphologies.

Coeur Alaska’s Kensington Mine uses a flotation mill to recover gold from sulphide bearing rock. Crushing and milling facilities are located directly south of the Jualin portal. On the portal bench, the ore is segregated by grade and blended before being fed to the crushing plant. The crushing plant is a two stage, closed-circuit system. Once crushed, the ore is fed to the ball mill and then to the flotation circuit. The initial design for the recovery process was a standard rougher/scavenger, cleaner re-cleaner configuration. The flotation circuit was modified in 2012 to maximize recovery. The end product of this facility is a gold concentrate consisting primarily of pyrite.

After blending based on grade, ore is fed to the crushing plant using a vibratory feeder. First stage crushing is achieved by using a jaw crusher to reduce the ore size to minus 4 inch. The primary crusher product is fed to a vibrating double deck screen. Until mid-2012, the lower screen deck separated the material at minus 0.375 inch. In mid-2012, the lower screen deck was changed to 0.75 inch opening, and then a 1.5-inch opening in 2014. This allows higher throughput by reducing circulating load in the crushing circuit. The oversize screen product is conveyed to a cone crusher, set at 3/4 inch. The secondary crusher product returns to the screen deck. The undersize screen product is fed to the mill. Mill feed is stored in a 1.100-ton capacity fine ore bin.

Ore from the fine ore bin is fed to the primary ball mill by belt. Grinding is accomplished using a 19 ft. 8 inch long by 11 ft. 1 inch diameter ball mill equipped with a 1,250 horsepower motor. Mill discharge is fed to one of two 20 inch cyclones. The cyclone overflow, P80 of 150µm, is fed to the flotation circuit, while the underflow is returned to the ball mill.

Primary flotation is affected in a circuit comprised of two rougher cells and four scavenger cells. Until late 2011, all of the concentrate produced in the primary circuit was sent to an 11 ft. 5 inch long by 7 ft. 2 inch diameter regrind mill, targeting a grind size p80 of 38µm, before being introduced to the cleaning circuit. This secondary grinding step was eliminated to prevent loss of mineral slimes. Rougher flotation product is either sent directly to the concentrate thickener or to the cleaner circuit. Scavenger product is sent to the cleaner circuit, which consists of four primary cleaner cells and two secondary re-cleaner cells.

Cleaned concentrate reports to a concentrate thickener, the underflow of which supplies a filter feed tank. The overflow returns to the process water system. The filter feed tank contents are pumped to a Larox filter press for dewatering. The dried filter cake from the Larox is weighed into 2-ton super sacks for shipment to refiners. Filtrate water returns to the process water system.

Tailings from the scavenger cells are mixed with flocculant and sent to a 29.5 ft. diameter high rate thickener. The underflow is then sent to either the tailings impound dam, or underground to the paste backfill plant. The overflow returns to the process water system.