The Florence copper deposit is an extensive Laramide type of porphyry copper deposit consisting of a large core of copper sulfide mineralization lying beneath a zone of copper oxide mineralization. The central portion of the deposit is overlain by approximately 375 to 425 feet of flat-lying conglomerate and alluvial material that contains a fine-grained silt and clay interbeds. The oxide and sulfide zones are separated by a transition zone ranging from 0 to 55 feet in thickness.

The main sulfide minerals are chalcopyrite, pyrite, and molybdenite with minor chalcocite and covellite. Molybdenite occurs as discrete grains or as a film on fracture surfaces; the average molybdenum grade is 0.008%. Pyrite is usually subordinate to chalcopyrite (ratios of 1:1 to 1:3), and both are found in veinlets and as disseminated grains; they commonly occur in quartz ± biotite veins rimmed by orthoclase and sericite. Supergene chalcocite coats pyrite and chalcocite
and dusts fracture surfaces. The supergene chalcocite blanket is very thin and irregular (zero to 50 feet); in most instances, the transition from the leachable copper silicates and oxides to the sulfide zone (relatively non-leachable) is quite abrupt.

Mineralization in the oxide zone consists primarily of chrysocolla with lesser “copper wad,” tenorite, cuprite, native copper, and trace azurite and brochantite. The majority of the copper occurs as chrysocolla in veins and fracture fillings, while the remainder occurs as copper-bearing clays in fracture fillings and former plagioclase sites. The thickness of the oxidized zone ranges from 40 to 1,000 feet with an average thickness of 400 feet.

A calculation of the total copper (“TCu”) grade by oxidation type for all assays within the Florence drill hole database shows that the oxide mineralization is similar, but enriched, relative to that of the primary sulfide mineralization. The overall average grade of the oxide and sulfide mineralization is approximately 0.356% TCu and 0.268% TCu, respectively. Copper mineralization is enriched in quartz monzonite host rock, relative to the intrusive granodiorite porphyry dikes (average grade of 0.38% TCu versus 0.27% TCu).

ISCR, the mining method proposed for the FCP, is an extraction method used for selected mineral deposit conditions as an alternative to open pit or underground mine methods. ISCR is also used as a secondary recovery method for copper, typically coupled with open pit mining/heap leaching or underground mining. The ISCR process involves injection of a highlydiluted low pH lixiviant solution (consisting of over 99% water) into mineralized material and the dissolution of the copper, which is captured in surrounding recovery wells where the resulting PLS is pumped to the surface for collection and processing in the SX/EW plant.

The mining equipment used for this method includes wells, pumps and pipelines used to inject, recover and convey process solutions.

The casing string will be composed of materials designed to withstand the proposed pressure and chemistry of the injected fluid. It will be cemented for its entire length and must pass a mechanical integrity test as defined by the USEPA. The proposed ISCR wells will be constructed with screened intervals located exclusively within the Bedrock Oxide Unit.

The active ISCR well field will be surrounded by a network of perimeter wells that will be pumped to maintain positive hydraulic control.

The active ISCR well field will be surrounded by a network of non-production pumping (hydraulic control) and observation wells to ensure that acidified process solutions do not migrate away from the leaching zone. The hydraulic control wells withdraw additional (nonproduction) water from the oxidized bedrock zone. Withdrawal of the non-production groundwater creates a depression in the piezometric surface around the active ISCR, which creates groundwater flow toward the ISCR well field in all directions.

Copper recovery for the FCP utilizes SX/EW technology to produce cathode copper from the copper-bearing leach solutions pumped from the ISCR well field. The SX/EW plant is initially designed to handle a flow of 7,400 gpm with a recovered copper concentration of 1.8 grams per
liter (g/L). After five years, the SX/EW plant will be expanded to handle a flow of 11,000 gpm. The processing plant and associated infrastructure is in the northeast corner of the State Land parcel. The process fluids are piped to and from the process plant in lined trenches.

The source of copper for this process is PLS extracted from the recovery wells, as described above. PLS is collected in a process pond with a double geomembrane liner system on the west side of the plant site. The PLS pond has a design capacity of 6,480,000 gallons, which provides a 14.6-hour residence time at 7,400 gpm and 9.8-hour residence time at the ultimate design flow rate of 11,000 gpm.

The PLS pond is adja ........