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 is transverse longhole stoping with paste backfill and mainly
used in the center area at Kensington. Drilling shows that the Kensington orebody narrows to the north and south (4 to 20 feet thick), thus longitudinal longhole stoping is used. In Raven longitudinal longhole stoping is the predominate mining method as the orebody is mainly narrow, between 5 to 20 feet thick, with most of mining in material 5 feet or less in thickness.

A minor amount of drift and fill mining has been done in Kensington Block E (Zone 41). Where a drift is driven (15 × 15 feet) parallel to the ore boundary, and driven 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 × 15 feet) and filled with paste or Cemented Rock Fill (CRF). There is no 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 a drift and fill or cut and fill mining method again in the future depending on circumstances and morphologies.

After being mucked clean, open stopes were filled with waste rock prior to 2013 and paste fill after 2013 when the paste plant was commissioned.

In Kensington transverse stoping, the dimension is primarily 40 feet in width, nominal height of 75 feet, and variable lengths, from 25 to 150 feet along strike. Access ramps (16 × 16 feet) and level development (15 × 15 feet) are driven in the footwall (above 910 level) or hanging wall (below 850 Level) of the orebody with twin boom jumbos, Load/Haul/Dump (LHD) loaders, and teledump low profile mine haul trucks. Ore is extracted by driving across the orebody on two levels, drilling and blasting with 60 to 80 feet vertical rings of blast holes between the two levels at a width of 40 to 50 feet and creating an open stope near perpendicular to the strike of the ore using Cubex and Simba longhole drills. 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 backreamed to the desired dimension.

In longitudinal stoping, ore is extracted by driving along the orebody on two levels, drilling and blasting with 60 to 90 feet rings of blast holes drilled down dip creating an open stope parallel to the strike and dip of the ore. Longitudinal stoping is used in ore up to 25 feet wide. Strike lengths will predominantly be constrained to less than 100 feet, with 80 feet as the optimum length open, to prevent hanging wall failures.

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 ........