The Candelones Project is comprised of the Candelones Main (CM), Candelones Connector (CC) and the Candelones Extension (CE) deposits. Drilling has now demonstrated that the CM and CC deposits are joined together, and the combined CM and CC deposits are referred to herein as the CMC deposit. The Project is located entirely within the Neita Sur Concession. The Candelones deposits feature anomalous gold, silver, copper, lead and zinc mineralization. To date, all mineralization is confined to brecciated dacite volcanoclastics where they are in contact with andesite volcanics/volcanoclastices (CMC, CE) or dacite volcanics (CM). Mineralization is currently interpreted to be a product of a hybrid type system. Volcanogenic massive sulphide (VMS) in a shallow water, back arc basin setting, is interpreted to have introduced low tenor copper, lead and zinc mineralization, coeval with deposition of the host dacite volcanoclastics, over a widespread area. Post mineral uplift developed extensive folding and faulting, interpreted to have produced extensive brecciation within the dacite volcanoclastic unit. The brecciated dacites offered ideal pathways for later, epithermal mineralization events associated with the late calc-akaline intrusives mapped elsewhere in the Tireo Formation that are possibly largely buried within the Concession limits. Hydrothemal fluid flow related to these buried intrusives is interpreted to have introduced the majority of the gold and silver into the Candelone ........

The Candelones Project will employ conventional truck-and-shovel open pit mining techniques. The operations will be fully undertaken by a contractor, with no drilling and blasting activities involved.

The Candelones Oxide Deposit is mined with two pits. The Main Pit, aligned north-west to south-east, measures 650 m along strike and 175 m in width. The Secondary Pit, which is oriented approximately north-south, is 240 m long and 150 m wide. Both pits have an average depth of 30 m.

The Main Pit design assumes access to the highest point in elevation at the north. The Secondary Pit design assumes access in the centre from the west. This provides access to the pushbacks and to shorten haul distances to the leach pad and waste dump from both pits.

No crusher will be utilized over the life of the mine; however, the coarser material will be handled by a ripping process.

The pit will be mined over a period of 39 months (3.3 years) at an average rate of 5,000 t/d.

Ore material will be sent to either the heap leach facility or an ore stockpile; the stockpile will serve as complement to feed the leach pad during the period of low production due to the rainy season. Waste material will be sent to the waste dump storage (WDS) located southeast of the pit.

The mining of the pit will be divided into six pushbacks during the 3.3 years of operation and be executed in 5 m benches.

Mining of the Candelones oxide miner ........

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Water supply for the Project will be obtained entirely by collecting rainwater in a surface storage lagoon and pumping it to the required locations around the Project site. The Project site is located in an area of high rainfall and a preliminary water balance has been developed; it is understood from Unigold that sufficient water supply will be available. Groundwater will not be used as a water source, and it is understood from Unigold that groundwater ingress is not expected to occur in open pit mining areas. Any rainwater accumulating in mining areas will be diverted into settlement ponds.