The term Candelones Project refers to the area within the Concession in which the Candelones Main (CM), Candelones Extension (CE) and Candelones Connector (CMC) deposits are located. The deposits that comprise the Candelones Project are entirely contained within the confines of the property.

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 Candelones deposits. The final stage of mineralization was reactivation of the fault systems followed by a late, mafic volcanic event which emplaced the observed mafic dikes and/or sills. These late intrusives are proximal to the high-grade systems that have been the focal point of drilling since 2015. It is currently interpreted that these late mafic intrusives may have remobilized gold to the dike margins.

At the CE and CMC deposits, mineralization is stratigraphically restricted to dacite volcanoclastics that underlie a sequence of andesite volcanics and volcanoclastic rocks. The contact strikes east-west and the dip varies from horizontal at the CMC and western limit of the CE, to 70º south at the eastern limit of the CE. The variability in dip is currently interpreted to be the result of the extensive faulting produced during the formation of the island of Hispaniola.

Dacite Breccia Mineralization – VMS Type
Dacite breccia typically starts at the andesite-dacite contact and extends for up to 125 m. Brecciation decreases as the distance from the contact increases, as does the tenor of mineralization. The contact can be identified visually. It is the most distinctive marker horizon identified to date. The footwall of the dacite breccia can be identified visually in the core as the intensity of brecciation decreases but the actual terminus of the mineralization is defined by assay cut-off. There is a sharp, order of magnitude decrease in gold grade from 100 ppb to 10 ppb that defines the footwall terminus of the host dacite.

Massive Sulphide Mineralization
Drilling in late 2015 intersected a zone of massive sulphide mineralization that is interpreted to be discordant to the andesite-dacite contact, striking northeast and plunging to the east at approximately 30º. The massive sulphide is pyrite dominant and has returned gold and copper values that are elevated by an order of magnitude relative to the VMS mineralization. The massive sulphide mineralization has been traced by drilling for a strike length of 350 m along an east-northeast trend. Gold and copper grades within the massive sulphide mineralization are markedly consistent, with no significant outliers.

Quartz Vein Polymetallic Mineralization – Target B Candelones Extension
Drilling in 2016 confirmed the presence of high-grade gold, silver, copper and zinc associated with quartz +/- barite veining and matrix replacement at Target B of the Candelones Extension. Pyrite and sphalerite are also common, with rare chalcopyrite and galena. This high-grade target is 150 m west of the massive sulphide mineralization at Target A and is interpreted to be a product of one or more hydrothermal fluid floods into the host dacite breccia, along interpreted sub-vertical, NE and NW fault zones. Drilling has intersected higher grade gold values over 150 m strike length. The mineralization is interpreted to occur as anastomosing veins within a fault bounded, sub-vertical fault block.

Dacite Breccia – Target C Mineralization
Target C mineralization is very similar to Target B. Elevated gold values are associated with a zone of intense brecciation. Sub-angular to sub-rounded fragments of dacite tuff are set in a silica-sulphide matrix dominated by sphalerite and pyrite, with rare chalcopyrite and galena. Gold occurs preferentially in areas that are flooded by barite and quartz or proximal to what are interpreted to be sub-vertical mafic dikes that bisect the breccia unit.

Candelones Connector
Mineralization at the CMC deposit occurs within a brecciated dacite tuff stratigraphically above an andesite volcanoclastic unit. Elevated gold values are associated with a zone of intense brecciation. Sub-angular to sub-rounded fragments of dacite tuff are set in a silica- sulphide matrix dominated by pyrite. Gold occurs preferentially in areas that are flooded by barite and quartz. As at the CE deposit, the gold mineralization is interpreted to be spatially related to NE and NW trending faults that are interpreted from the current data set. Unlike the CE deposit, mineralization at the CMC outcrops to surface and is intensely weathered and oxidized to a depth approaching 30.0 m from surface. Metallurgical testing to date suggests that gold recoveries are particularly robust, with +95% recovery estimated from direct cyanidation. Below the oxide horizon, the mineralization appears to be largely VMS type mineralization, limited to the brecciated dacites, to the andesite contact where anomalous grades are immediately truncated. Below the oxide horizon, the mineralization appears to be largely VMS type mineralization, limited to the brecciated dacites, to the andesite contact where anomalous grades are immediately truncated.

Candelones Main
Mineralization at the CM deposit occurs within a broad interval of brecciated dacite tuff in contact with what is interpreted to be a dacite intrusive. The CM deposit strikes northwest, almost perpendicular to the strike of the CE deposit, and dips at 50-70º to the northeast. The mineralization is interpreted to be largely VMS type mineralization, with the tenor of mineralization directly related to the intensity of brecciation. The hanging wall rocks are comprised of dacite tuffs. As at the CMC deposit, the CM mineralization outcrops to surface and is oxidized to depths of over 30 m. Strong clay alteration is also common, with extensive illite and montmorillonite associated with the mineralized envelope near surface. Extensive silica alteration is also observed within the sulphide component below the oxidation cap.

Due to the fact that the targeted mineralization is located at or near the surface topography, it was determined that mining of the deposit would be best performed by open pit rather than underground methods.

The Candelones Starter Pit will primarily be mined using hydraulic excavators, which are easily able to free dig the mineralized overburden and oxidized rock and waste down to the transition material. The PEA assumes that only the transition leach feed and transition waste will require blasting. The total amount of rock that will require blasting is 14% of the total and will be encountered during the latter half of the mine life.

The leach feed to be sent to a primary crusher will be oxidized saprolitic material which will not be blasted, transition material which is partially oxidized and is planned to be blasted 75% of the time, and fresh unoxidized sulphide rock which will be blasted 100% of the time and will use a higher powder factor.

The production requirement for the Candelones Project was to establish a mining rate that would achieve an optimal balance between capital cost minimization and operating cost minimization. This was achieved through the adoption of a three-year mine life, with all mineralized rock above the cut-off grade going directly to the primary crusher and then onto the leach pad.

Mining of the Candelones Starter pit will generally be executed in 4 m benches, using 2 m flitches where preferred. Whereas the block model has 6 m x 6 m x 2 m (height) dimensions, the mine planning has the ability to look at strategic selectivity using of 2 m flitches, as needed. However, for improved productivity, 4 m benches will be preferred where possible. Where drilling is required in the transition material, 4 m will be drilled with 0.75 m subgrade.

The overall pit slope angles are all below the 40° maximum. The pit covers an area of 15.7 ha, has a perimeter of 3.3 km in length, measures 0.88 km from east to west and 0.60 km from north to south. The elevation along the pit’s perimeter varies from 516 m to 607 m.

The mining rate follows the 5,000 t/d throughput capacity of the crushing circuit by which the leach feed is reduced in size prior to being loaded onto the leach pad. This amounts to 1.8 Mt of leach feed planned to be mined, crushed and leached per year.

The updated sulphide mineral resource estimate disclosed herein assumes that the mineral deposits at the Candelones Project will be exploited primarily by means of an open pit, followed by the transition to an underground mine with associated processing facilities and infrastructure. Unigold believes there are multiple benefits offered by combining the open pit and underground mining methods for the sulphide deposits.

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The process selected for the Candelones Oxide PEA comprises a 5,000 t/d heap leach operation.

A total of 5,000 t/d of mineralization from the Candelones open pit will be mined and hauled approximately 3 km onto a “run-of-mine” heap leach pad. The feed to the leaching process will then be crushed using a mineral sizer, in order to break-up agglomerates and oversized material. The leach feed will be mixed with hydrated lime prior to being delivered to the heap leach pad. The pad will be irrigated with a leach solution obtaining, an average 75% leach gold recovery following a 10-week leach cycle.

Gold and silver will be recovered from the pregnant leach solution (PLS) by contacting the solution with granular activated carbon-in-columns (CIC), followed by a Zadra adsorption, desorption and regeneration (ADR) plant, comprising acid wash, elution, carbon handling, carbon regeneration, electrowinning cells and refinery to produce doré bars. No tailings facility will be r ........