The geological setting, hydrothermal alteration, styles of gold-silver mineralization, and close spatial and timing association with silica sinter deposition, indicate that Grassy Mountain is an example of the hot-springs subtype of low-sulfidation, epithermal precious-metals deposits. The Grassy Mountain deposit is characterized by stacked sinter terraces that demonstrate hydrothermal fluids vented at the paleosurface concurrent with lacustrine and intermittent fluvial sedimentation.

The Grassy Mountain gold–silver deposit is located largely within the silicic and potassic alteration, zones, beginning approximately 200 ft below the surface. The deposit has extents of 1,900 ft along a N60°E to N70°E axis, as much as 2,700 ft in a northwest-southeast direction, and as much as 1,240 ft vertically. The surface expression of the mineralization is indicated by weak to moderately strong silicification and iron-staining, accompanied by scattered, 1/8- to 1.0-inch wide creamy to light-gray chalcedonic veins that filled joints.

The deposit consists of a central higher-grade core with gold grades of >~0.03 oz/ton Au that is surrounded by a broad envelope of lower-grade mineralization. The central higher-grade core is almost 1,000 ft long on the N60°E to N70°E axis, by 450 ft in width and 450 ft in vertical extent, all of which is above the Kern Basin Tuff and below a distinctive sinter unit.

Central Higher-Grade Core Zone
Three distinct and overlapping types of gold–silver mineralization are recognized within the central core of the deposit. These are gold-bearing chalcedonic quartz ± adularia veins, disseminated mineralization in silicified siltstone and arkose, and gold and silver in bodies of clay matrix breccia.

Zones of high-grade mineralization are defined by the presence of chalcedonic quartz ± adularia veins. Mineralized quartz ± adularia vein types include single, banded, colloform, brecciated and calcitepseudomorphed veins. Colloform veins tend to carry the highest grades (>0.5 oz/ton Au), with visible gold to as much as 0.02 inches associated with argentite. Veins with relict bladed calcite texture also contain higher gold grades than the banded and single vein types. Gold mostly occurs as electrum along the vein margins or within microscopic voids. Some veins carry very little grade or are barren. At least some of the higher-grade zones of veins are thought to strike approximately N70°E.

Vein widths range from 1/16 to ~2.0 inches. Individually, such narrow veins are unlikely to have lateral or vertical extents of significance, but vein frequency can average one vein per foot in places. Vein swarms have strike lengths of 400 to 700 ft and vertical extents of 100 to 250 ft at elevations of 3,150 to 3,400 ft. Individual veins are too narrow to trace or correlate from hole to hole.

A steep southerly dip (70–85°) of the veins is inferred from vein intersection angles with drill core axes and bedding. Veins are mostly perpendicular to bedding, which generally dips 10–25° NNE within the deposit. Vein intersection angles of 10–25° to the core axis were mostly recorded in core holes GMC001 to GMC-008 angled at -50° at S20°E, compared with 25° to 50° intersection angles in holes GMC009 to GMC-011 angled -50° at N20°W. The N70°E strike of the veins is supported by: 1) surface mapping, 2) vein orientation perpendicular to bedding, 3) grade-thickness contouring, and 4) the overall trend in mineralization with grades in excess of ~0.03 oz/ton Au.

The veins crosscut the silicified sediments and have extremely sharp grade boundaries with the sediments. Vein frequency diminishes abruptly below an elevation of ~3,000 ft at the west–southwest limit of the higher-grade core to ~3,100 ft at the east-northeastern limit, and very few high-grade veins were encountered above the higher-grade core of the deposit

Within the higher-grade core, high gold grades are also present in silicified siltstone and arkose with no visible veins. In these cases, gold and silver are inferred to be very finely disseminated in a stratiform manner in the silicified rock. Fine-grained pyrite is commonly disseminated in the silicified siltstone and sandstone where oxidation has not occurred. Contacts between siltstone and arkose beds seem to be more favorable and carry higher gold grades. In places, beds of tuff and tuffaceous siltstone appear to be particularly favorable host for higher-grade mineralization that lacks associated veins.

The third style of gold–silver mineralization was referred to by Newmont and later operators as “clay matrix breccia”, bodies of which may be more prevalent in the lower portion of the higher- grade core of the deposit. These bodies are interpreted to extend at near-vertical angles up and down into the surrounding, low-grade gold-silver envelope. Clay matrix breccias are mainly of clast-supported types and contain sub-rounded to sub-angular, sand- to boulder-sized clasts of silicified and/or veined arkose and siltstone with minor amounts of clay and iron-oxide minerals between the clasts. In drill core, clay matrix breccia intervals are intersected over lengths of as much as several tens of feet, but their true thickness and exact orientations are poorly understood, in part because their margins are commonly irregular-to-gradational and not planar, except where structural fabrics related to fault movement are evident. In some cases, it is difficult to discern where clay matrix breccias end and similar fault-related breccias begin; it is possible the two are in some cases genetically related.

Lower-Grade Envelope
Lower-grade mineralization envelopes the higher-grade core and, farther from the core, extends outwards as stratiform, mineralized lenses parallel to bedding. There are very few visible chalcedonic veins; the gold and silver are inferred to be disseminated within the silicified arkose and siltstone units. Contacts between arkose, siltstone, and sinter appear to have been preferentially mineralized, and beds of tuff and tuffaceous siltstone also were favorable sites for mineralization. Low-grade mineralization is also present in numerous intervals of silica sinter, but not all sinter intervals are mineralized. Sinter-hosted mineralization may be disseminated, or within fractures where the sinter has been structurally disrupted.

The Grassy Mountain mine will be an underground operation accessed via one decline and a system of internal ramps. One ventilation raise is included in the design to be used for ventilation and secondary egress. The mechanized cut-and-fill mining method was selected. The mining direction will be underhand. Cemented rock fill (CRF) will be used for backfill. The mechanized cut-and-fill method is highly flexible and can achieve high recovery rates in deposits with complex geometries, as is the case at the Grassy Mountain deposit. The estimated mine life is eight years.

The mining sequence contains a detailed level sequence and an underhand sequence. The level access is mined first. The mains are mined second. Typically, two mains are mined at the same time providing multiple mining locations on a level. After the mains are mined, then the production drifts can begin mining. The production drifts are sequenced with primaries and secondaries. The primaries are mined and backfilled first. This continues until the entire level is complete. After the entire level is complete the level access is backfilled. The underhand sequence is grouped into lifts. One level in each lift can be mining at any given time during the life of mine. The underhand sequence starts at the top and works down in elevation. Constraints will be applied to ensure that the bottom level of a lift does not influence the top level of the lift below.

The portal is designed to allow access to the underground mine facilities while providing adequate space for equipment and vehicles. It will be located uphill and approximately 750 ft south of the primary crusher, at an approximate elevation of 3,749 ft. Weak rock mass ground conditions at the portal require that a shallow box-cut excavation be established to form a suitable face where tunneling can occur.

The Grassy Mountain orebody will be accessed using a 15 x 15 ft main decline, developed from a portal on surface. The decline will provide the connection to all services. The design intent is to have the decline located as close as possible to the mineralization in order to reduce transportation costs, but sufficiently removed from mining activities to ensure that the decline is geotechnically stable for the planned life-of-mine (LOM).

The mine design was based on an average production rate of 1,200 tons per day using a four-day-on and three-day-off schedule, with two 12-hour shifts per day, to provide 24-hour coverage during the four operating days at full operation. This will provide sufficient material to feed 750 tons/d to the mill on a seven day per week basis.

The mining cycle involves drilling, blasting, and mucking for the development and production access. The final part of the mining cycle is to backfill the stopes.

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The process plant is designed for treatment of 750 tons/d or 34 tons/hour based on an availability of 7,998 hours per annum or 91.3%. The crushing section design is set at 70% availability and the gold room availability is set at 52 weeks per year including two operating days and one smelting day per week. The plant is designed to operate with two shifts per day, 365 days per year, and will produce doré bars.

The process flowsheet was developed based on data developed in the 2018 PFS, together with updated information from metallurgical testwork as outlined in Section 13. The crushing and grinding circuit sizing were determined using in-house Bruno and Ausgrind simulations, respectively. During the 2020 FS, the flowsheet developed during the 2018 PFS was modified to a simpler, lower capital cost alternative comprising:
-Two-stage crushing circuit;
-Grinding circuit;
-Hybrid leach-CIL circuit with pre-aeration;
-Mercury removal circuit;
-Cyanide dest ........