The deposits at El Peñón are low to intermediate epithermal gold-silver deposits, hosted in steeply dipping fault-controlled veins following rhyolite dome emplacement. Gold and silver mineralization comprises disseminations of electrum, native gold and silver, acanthite, silver sulphosalts and halides, plus accessory pyrite occurring with quartz, adularia, carbonates, and clay minerals. These minerals were deposited from boiling of low salinity fluids circulating in a hydrothermal system driven by the Eocene to Paleocene magmatism. Late stage oxidation has occurred to a depth of 400 m below surface.

The deposit comprises many individual tabular, steeply dipping zones or shoots that are amenable to mining by both underground and surface methods. Vein widths range from decimetre-scale to over 20 m. Individual mineralized shoots measure from less than one kilometre to four kilometres in strike length, and up to 350 m in the down-dip direction. Gold grades range up to hundreds of grams per tonne but are more typically less than 30 g/t. Silver grades are in the order of hundreds to thousands of grams per tonne.

There are thirteen main vein zones and many subsidiary veins in nine vein systems that have supported, support currently, or are planned to support surface and underground mining operations. The veins strike predominantly north south and dip steeply to the east and west. North-northeast to northeast-striking fault zones are also host to mineralized zones, however, the relative proportion of the overall deposit is small. The principal mineralized veins are Al Este, Bonanza, Cerro Martillo/Dorada, Dominador, El Valle/Discovery Wash, Fortuna, Martillo Flats, Pampa Campamento, Playa, Providencia, Quebrada Colorada, Quebrada Orito, and Vista Norte.

Gold and silver mineralization consists of disseminated electrum, native gold, native silver, silver sulphosalts, and silver halides occurring in a gangue of predominantly quartz, adularia, carbonate, and clay. Electrum is the most common form of precious metals in the deposit and occurs as micron- to millimetre-size subrounded and irregular grains. Two phases of electrum are present: a primary phase, which contains approximately 55% Au to 65% Au, and a secondary phase, which has resulted from supergene processes that have remobilized silver, and which typically consists of over 95% Au.

The mining method utilized at El Peñón is the Bench and Fill Method, which is a narrow vein longhole stoping method followed by a combination of consolidated and unconsolidated backfill to provide the required support for continued mining. Development of the overcut, or drill drift, and the undercut, or mucking drift, is completed at the required dimensions of four metres in width to permit operating clearances for both the longhole drill rigs and the load-hauldump (LHD) equipment. These drifts are advanced using a “split-blast” method whereby the vein material is mined first and then the remainder of the drift waste material is slashed out and mucked. This waste material is later used for unconsolidated backfill.

Stoping dimensions are 7.5 m or 15 m in strike length and from 6 m to 16 m in height and widths vary from one metre to six metres. Production holes are drilled with the longhole drill then loaded, blasted, and mucked with six cubic yard scooptrams, dumped into 30 tonne trucks and hauled to the surface stockpile. Waste backfill or cemented rockfill is placed as required.

Underground mine infrastructure includes the required ramps, cross-cuts for access and various lateral development, as well as excavations for power stations, mine sumps, refuge stations, maintenance shops, and other facilities. Ventilation raises are driven as required to provide the air requirement to meet mine regulations for the mine workers and operating underground equipment. Other installations include a shotcrete plant, backfill plant, and communications system. The total mine system extends for approximately ten kilometres on strike and covers a vertical extent of approximately 500 m, from the highest portal collar elevation to the lowest mine workings.

The process plant and associated facilities process run-of-mine (ROM) ore that is delivered to the primary crusher, using the main processes listed below:

• Crushing
• Grinding and pre-leaching thickening
• Leaching
• Counter-current decantation concentrate solution recovery
• Clarification, zinc precipitation and precipitate filtering
• Refining
• Tailings filtering
• Tailings disposal.

The El Peñón processing plant has a nominal production capacity of approximately 1.533 million tpa of stockpiled and mined ore.

ROM ore is dumped from a seven cubic metre capacity front-end loader (CAT 988H) through a 600 mm square-grid grizzly into 100 t capacity hopper. A 1,500 mm wide apron feeder is used to transfer ore from the dump hopper to the jaw crusher. Fine material is collected and transported directly to the conveyor belt that carries primary crushed material. Coarse material is fed into a 950 mm x 1,250 mm jaw crush ........