The Silvertip mineralization is a silver-zinc-lead Carbonate Replacement Deposit (CRD) with metals content, polyphase mineralization, abundant replacement textures, pyrite pseudomorphing pyrrhotite, and wallrock alteration reminiscent of many of the manto-chimney CRD’s of Mexico and the western US

These economically attractive, polymetallic systems can stretch continuously from copper-gold enriched skarns near intrusion contacts in the “proximal” part of the system, to massive sulfide manto and chimney deposits with no exposed igneous relationship in the “distal” areas. Traditionally these deposits have been considered difficult exploration targets due to a paucity of peripheral indicators to mineralization such as hydrothermal alteration or consistent relationships to breccias or structures.

The Silvertip mineralization consists of silver-lead-zinc massive sulphide, formed by hydrothermal replacement processes in McDame Group limestone. In Silvertip terminology, it is known as “Lower Zone”. The main mineralized zones are not exposed, lying between about 50 m and several hundred metres beneath the surface, and covered by the Earn Group. These zones are mainly north of Silvertip Mountain and east of Camp Creek. The ‘Silver Creek’ area is in the west and northwest; the ‘Discovery’ area lies farther east and at greater depth; and the ‘Discovery North’ area, lying to the north, has received relatively little attention to date, but is likely continuous with the other zones.

Another type of lead-zinc sulphide mineralization is present on the property, namely Early Mississippian syngenetic ‘sedex’ deposits associated with siliceous to baritic exhalite subunits in unit 2A of the Earn Group.

Most of the mineralization defined so far occurs at the top of the McDame limestone, at or near the unconformable contact with the Earn Group, although significant sulphides are also present much deeper in the McDame. The massive sulphides are in the form of gently plunging tubes, or cape shaped mantos, up to about 20 m thick and 30 m wide, and in places extending for at least 200 m. Narrower and thicker bodies of massive sulphide, between 20 and 30 m thick, have been intersected locally by past drilling, and are probably discordant, vertically oriented (minor) chimneys connecting mantos at different levels.

Contacts between the massive sulphides and the host limestone can be remarkably sharp, but transitional zones of alteration (silicification, dolomitization) and recrystallization and brecciation are common (not all the dolomitization is related to the mineralization event – some is much older).

The mineralization consists of early-formed pyrite, pyrrhotite and sphalerite and lesser galena, and a slightly younger, higher temperature, sulphosalt-sulphide suite of minerals. The latter contain the main silver-bearing phases including pyrargyrite-proustite, boulangerite-jamesonite and tetrahedrite (freibergite), as well as silver-rich galena. Quartz and calcite are the main gangue minerals and locally fill late-stage vugs and cavities. Brecciation of sulphides, mixed with limestone vein quartz and calcite, attest to multiple phases of fluid infusion and intra-mineral, solution collapse processes.

There are two portals which allow access to the Silvertip Mine, the historical portal, referred to as Portal 1 (P1), which is used for personnel and material access, and the ventilation intake portal, referred to as Portal 2 (P2) which is also used for emergency egress. The historical ramp was driven with a design profile of 4.27 mW by 4.57 mH and the newer ramp is developed with a design profile of 4.5 mH by 4.5 mW.

The Silvertip mine was designed on the basis of the following key principles:

• Mechanized trackless operation with decline access;
• A production rate building up to 1,000 tpd; and
• A material handling system using truck haulage of ore and waste to surface.

The primary mining method planned at Silvertip for the sub-horizontal manto deposits is cut and fill (CAF). When possible slashing of the walls and backs is utilized to improve ore recovery. This method is ideal for this orebody due to the irregular shape, shallow dip, relatively high grade, and generally poor rock competency. Also, it can limit the exposed span and support the hangingwall.

Longhole stoping is also planned for some of the thicker manto and the vertical chimney mineralization.

CAF is a development-intensive mining method in which parallel drifts are mined in a primary- secondary sequence. After the primary drift is mined, it is backfilled with cemented fill, so that the secondary drift may be mined alongside. The cut and fill method is used for ore bodies that are irregular in shape, have a shallow dip, and have relatively high value ore. Almost all of the ore can be extracted with this method.

The stopes are accessed using a waste attack ramp. Up to five drift-and-fill cuts can be mined off each attack ramp. Temporary attach ramps will be developed from the main level access drift towards the mineralized zone. The lowest and first cut is accessed from a -20% attack ramp. After the primary and secondary drifts are mined and filled from the lowest cut, a second cut is established by slashing down the back of the attack ramp and backfilling with waste to establish a ramp at -10%. From this attack ramp another set of primary and secondary drifts are mined and filled. This process is repeated to establish and mine from attack ramps at +2%, +10%, and +20% at which point the level is depleted.

Dilution factors applied to CAF designs is 5% in a primary cut and 15% in a secondary cut.

Slashing and benching is used in some areas in conjunction of the cut and fill method described above. Slashing of the backs is used where the geology is highly irregular, and ore would otherwise be left in the back due to the mining development constraints. Slashing will be applied only in the top cut drift and where there is no geotechnical concern. The slash is left unsupported and mucked by remote scoop. Following mucking, each drift is filled with paste fill or CRF.

Benching is used in the bottom cut drift where ore is left in the floor due to irregular geology and mining development constraint. The maximum height of the bench is 4.5 m. After the bench is completely mucked the drift is filled with paste fill or CRF.

A dilution factor of 25% is applied to slashing.

The longhole stoping method is used for areas where the orebody is a vertical structure and is dipping steeper than 50 degrees or in areas where the orebody is thicker than 10 m. Longhole stoping is a less development intensive mining method which reduces mining costs. Maximum stope dimensions are planned at 20 m height and 18 m strike length.

For transverse longhole stopes the methodology is to develop the overcut and undercut drifts and longhole mine the stope up to the sill of the overcut drift leaving a pillar of ore between the primary and secondary drifts. After both primary and secondary stopes are filled a tertiary drift will recover the ore pillars. This minimizes the exposure to weak Earn rock in the hangingwall and secures that the Earn contact is always supported.

A dilution factor of 10% applied to longitudinal longhole stopes and 12% is applied to transverse longhole stopes.

Current process plant design is based on an annual plant throughput rate of 365,000 t of Run-of-Mine (ROM) ore from the mine based on a 365 days per year operation. Daily nominal throughput rate is 1,000 t and the process is designed to enable the production of a lead-silver and zinc concentrate for shipment to smelters. Tailings from the zinc flotation is floated for its sulphides content (mainly pyrite) producing a PAG (flotation concentrate) and a NAG flotation tailings streams. Both tailings streams are thickened and filtered separately and the PAG pyrite concentrate filter cake is sent to the paste back fill plant, located in the main plant, for the preparation of paste backfill for underground.

The plant description provided in this section is prepared by major process areas of the process facility as follows:

• Primary crushing and coarse ore storage bin
• Grinding and classification
• Lead rougher-cleaner flotation and regrind
• Zinc rougher-cleaner flotation and regrind
• Pyrite rougher flotation
• Lead thickening and filtration
• Zinc thickening and filtration
• Pyrite concentrate thickening, filtration, and paste backfilling
• Pyrite tailings thickening and filtration and dry-stack disposal
• Reagent mixing
• Services and ancillaries.