Gold mineralization at the Gualcamayo Property occurs in three main areas: Quebrada del Diablo (QDD), Las Vacas (LV), and Salamanca. The QDD area includes the QDD Main, Condor, Potenciales, Amelia Inés and Magdalena (together AIM), Target D, QDD Lower, and Rodado deposits. There are also a number of small satellite deposits not currently included in the mine plan.

Three distinct mineralization types of economic interest occur in the Gualcamayo Property:
• sediment-hosted distal-disseminated gold (QDD)
• sulphide-bearing skarn deposits containing copper zinc and molybdenum with late stage gold-arsenic mineralization (Amelia Inés and Magdalena)
• porphyry style molybdenum mineralization (Quebrada Perdida)

Gold mineralization at QDD occurs in carbonate sedimentary rocks within conformable and discordant carbonate breccias and fractured limestone. The gold mineralization is related to a hydrothermal event overprinting the proximal skarns and extending into the surrounding marbles and limestones. The QDD canyon itself lies along a fault/dyke system, which is believed to be a reactivated, Ordovician rift structure that acted as the primary conduit for hydrothermal fluids migrating away from the intrusive contacts.

The mineralizing fluids were dispersed into a semi conformable, receptive limestone aquifer traveling up dip following the hydraulic gradient, more than 600 m away from the QDD feeder structure. The permeability was provided by several deformation and alteration factors forming large conformable collapse breccias and includes:
• early meteoric karsting of the Upper San Juan Formation and in particular the cliffy, bioturbated limestone member;
• hydrothermal dolomitization of the pre-existing diagenetic dolomite member of the upper San Juan Formation that initiated collapse and breccia development of the over lying karsted limestone;
• East-west faulting, tectonic brecciation along fold hinges, stylolite formation during the ongoing contractional, and transpressive deformation during the Andean orogeny.

These three factors produced a very permeable stratigraphic window (conformable breccia) within the Upper San Juan Formation that later focussed mineralizing sulphurous fluids through the earlier hydrothermal collapse breccias.

Higher-grade zones in the QDD deposit (> 2 g/t Au) are common and related to fold hinges, sediment infilled karst cavities, and brecciated intrusive contacts with limestone and marble. Mineralized breccia thicknesses range from 30 m to 150 m thick and extend more than 500 m outboard to the east and northwest of the QDD feeder structure. Due to the complex folding along north-northwest and east-west axes and strong lithological control, the mineralized collapse breccias form an undulatory ore deposit (dome and basin geometry) underlain by the hydrothermally altered dolomite member of the upper San Juan Formation.

Although more confined, gold mineralization remains open down dip along the QDD fault zone cutting the white recessive limestone unit (white marble) of the lower San Juan Formation.

The QDD deposit is a silica poor, high-level gold-arsenic system with fine marcasite and trace amounts of realgar and orpiment forming the main sulphide minerals. Silver values are generally less than 0.1 ppm. Barium is also elevated (200 ppm to 400 ppm) with higher concentrations localized along brecciated east-west striking dike margins. Mercury and antimony are weakly anomalous. Strong clay alteration along brecciated intrusive margins consisting of supergene kaolinite and alunite is also common suggesting a fairly acidic hydrothermal system. Gold occurs mainly as one to five micron inclusions within marcasite that was deposited with calcite along fractures and breccia matrices.

At AIM, late stage gold-arsenic mineralization overprints skarn zones and extends into the surrounding marbles of the San Juan Formation. Skarn hosted mineralization comprised of chalcopyrite, sphalerite, galena, pyrrhotite, and pyrite was deposited as a retrograde event preceding the introduction of the gold-arsenic mineralization.

Mineralization averaging 3 g/t Au is intimately associated with fine grained marcasite that lines late fractures and forms the chief component to marble and skarn breccias matrices. Brecciation and higher-grade gold mineralization are localized along the west to northwest trending marble– skarn contact and cross cutting east-west tensional structures. The rheological contrast between the brittle skarn and ductile marble is believed to have accommodated much of the movement during later wrench fault tectonics, forming localized east-west trending, dilational zones (i.e., breccia zones) that extend tens of metres outboard into the marble and skarn from the contact.

In addition to tectonic brecciation, gold mineralization was also enhanced by the presence of pre-existing karst cavities within the Cliffy Bioturbated member of the San Juan Formation and collapse generated by early hydrothermal dolomitization of the underlying Triplets member. These collapsed karst voids that have undergone late tectonic brecciation were later filled with semi massive, fine grained marcasite with dolomitized marble clasts over thicknesses greater than 10 m. This style of mineralization forms the highest-grade mineralized zones returning up to 30 g/t Au over 12 m.

Silver is anomalous but very sporadic returning greater than 30 g/t within the higher grade (>5 g/t Au) gold zones. Silver is localized within retrograde tetrahedrite veinlets and possibly electrum during deposition of the later stage fine grained marcasite. Inductively coupled plasma (ICP) analysis of the marcasite (sulfuros negros) also shows elevated lead, zinc, and molybdenum but relatively low silver levels.

Negligible gold mineralization extends into the intrusive stock to the north. Narrow (one to three centimetres wide) sheeted quartz-molybdenite veinlets are generally confined within the skarn at both Magdalena and Amelia Ines and extend outboard into the intrusive stock, localized along vertical, east-west tension structures.

Areas of high molybdenum content commonly lie peripheral to the gold enriched zones and overlap the intrusive contacts. Molybdenum mineralization is often associated with high manganese levels and occurs mainly in skarn with lesser amounts hosted by marble and intrusive rocks.

The Gualcamayo Mine consists of three operating open pits, QDD Main, AIM, and Condor, and one operating underground mine, QDD Lower. The operation also includes crushing facilities, an adsorption, desorption and recovery (ADR) plant, heap leach pads; and accommodation camp, maintenance buildings, and office buildings. The Deep Carbonates Project (DCP), which consists of the Santiago, Feeder, and Rodado deposits, is the primary target for future expansion.

The current Life of Mine (LOM) plan is for three years of mining and processing. Mineros intends to expand the current Mineral Reserves and further develop the DCP as an underground mine.

OPEN PIT MINING
Open pit mining takes place in various distinct areas of the Gualcamayo Mine, including a central, large open pit area, and three small satellite workings. As the deposits are located against a mountainside, the open pit operation is a combination of hillside benches and in pit benches. Most of the ore haul is downgrade.

Open pit ore production employs standard drill and blast, load and haul operational procedures. Mining is carried out on 10 m bench heights, with some pit walls left with a double bench.

Material is loaded and transported to an ore pass, on the edge of the QDD Main pit, which delivers the material to an underground primary crusher, where it is combined with underground ore. The ore is then conveyed to a secondary crushing system on surface, after which it is taken to one of two leach pads through a system of grasshopper conveyors.

Production comes from three teams with two excavators each. Eight articulated dump trucks (ADT) with capacities of 36 t are used to haul broken rock. All the equipment is owned and operated by MASA.

Waste dumps are located in the immediate vicinity of each open pit and tend to be dumps on the hillside edge. In some instances, the waste dump is rehandled by being pushed further down the hill as the pit deepens.

UNDERGROUND MINING
Underground production started in March 2013, and the SLC method has been used for the last three years.

Approximately 41% of the mill feed tonnes and 40% of the ounces in the mill feed come from underground sources, the QDDL and Cuerpo Este orebodies, using SLC.

The underground workings are accessed by a conveyor decline and vehicle access ramp. The vehicle access ramp is the primary access for personnel, material, and equipment, as well as the egress for waste rock and the ventilation intake. The conveyor is used to transport ore out of the Gualcamayo Mine and to the heap leaching operation.

Current underground mining in the QDDL ore zone comes from two (1782L and 1798L) of the five existing levels. Current production rates vary between 3,000 tpd and 3,500 tpd.

Stopes are based on development ends in ore with rings sequentially blasted, followed by the drawdown of broken material, assisted by caving. Levels are designed with 14 m to 16 m vertical spacing. The level is accessed off the main ramp with a footwall drift developed 20 m from the planned mining areas. Ore is accessed by cross-cuts which are developed from the footwall drift to the end of the mineralized zone at 15 m spacing. A series of slot raises are blasted out at the end of each cross-cut to provide the required void space for blasting of subsequent stope rings. Production drill holes are fan drilled with a 2.5 m burden and 80° dump angle. The production rings are blasted one at a time and sequentially starting from the end of the cross-cut. Depending on the shape of the stope, each ring delivers approximately 1,500 t to 2,200 t of ore. The blasted material is supplemented by ore that caves into the void, as well as ore from the previously mined stopes above that were not fully loaded out.

Ore is loaded by load-haul-dump (LHD) units and trammed to one of two rehandle points. From the rehandle point it is loaded into trucks and taken to an underground tip, conveyed to an underground crusher, mixed with surface ore received via an ore pass, and then conveyed out of the Gualcamayo Mine to the fine crushing complex. The conveyor has a capacity of 5,000 tpd.

Ore is mined in the open pit and underground mines, with the primary crusher located underground. Open pit ore is dumped from the surface either into an ore pass or an ore chute, both of which deliver the ore to the underground primary crushing and conveying system. The primary crusher reduces the ore to P80 150 mm. Crushed ore is transported via overland conveyor to the crushed ore stockpile. Ore is drawn from the crushed ore stockpile with apron feeders and conveyed to the secondary-tertiary crushing circuit. Ore is screened on the secondary screen, with oversized material fed to the secondary crusher. The secondary crusher product is then conveyed to the tertiary crushers which are closed by the tertiary screens. The screen undersized product, with P80 25 mm from the secondary and tertiary screens is conveyed to the heap leach pad.

The Gualcamayo process facility is designed to treat 25,000 tpd of ore using primary, secondary, and tertiary crushing, heap leaching, carbon adsorption-desorption-regeneration (ADR), for gold recovery, electrowinning of gold from the gold bearing eluant solution and casting of gold doré.

The fines in the ore are agglomerated by adding cement to the ore on the heap leach pad loading conveyor, which mixes as it transfers from one conveyor to the next. The ore is then loaded onto the heap leach pad in lifts with a conveyor stacker. Cyanide leach solution is distributed over the ore with pipelines and drip emitter tubing. The solution percolates through the ore dissolving the gold and is collected on the pad liner and transferred to the pregnant solution pond by gravity in lined channels.

The pregnant gold solution is pumped from the pond through carbon columns in series to adsorb the gold in solution onto the carbon. The barren solution exiting the carbon columns fl ........