The Escalones Property lies within the Miocene to Pliocene age Pelambres-El Teniente Porphyry copper belt, which hosts the world’s largest underground copper mine at El Teniente, as well as other large copper deposits at Los Bronces-Andina, Pelambres (Katsura, 2006) and Bajo La Alumbrera in Argentina. Copper mineralization at Escalones occurs in two forms: (1) as skarn and lithologically controlled mineralization hosted by altered sandstone/shale and intrusive dikes and sills and (2) as porphyry-style disseminated and stockwork mineralization hosted by an underlying intrusive granodiorite-diorite stock. Rock geochemistry from surface and drill core shows anomalous levels of gold, silver, and molybdenum that are spatially associated with the copper mineralization. This spatial relationship may also be due to separate pulses of mineralization or zoning within a much larger porphyry system.

Porphyry mineralization is associated with moderate to intense potassic alteration (as secondary biotite) in the granodiorite and adjacent hornfelsed sandstone. The metasomatic replacement or skarn-type mineralization is hosted by calcareous, feldspathic sediments, which form an open, upright, north-trending fold cored by the intrusive porphyry system. High-grade copper was historically mined (15 tonnes at 12% copper (Cu) (Katsura, 2006) at Escalones from exposures of magnetite-chalcopyrite skarn at Escalones Alto and prospects along Escalones Bajo. Previous drilling has demonstrated that high-grade magnetite skarn extends to the east and south from outcroppings at Escalones Alto and changes to calcsilicate dominated assemblages down-dip.

Skarn mineralization peripheral to the porphyry along the upper eastern margin (Escalones Alto) comprises mostly magnetite, garnet, and pyroxene skarn developed within sandstone, carbonate, and calcareous shale near contacts with intrusive rocks, with coarse copper oxides and carbonate near surface, transitioning to chalcopyrite-pyrite at depth. Finer disseminated and fracture-controlled mineralization occurs within biotite hornfels with quartz stockwork in steeply east-dipping hornfelsed calcareous shale and fine sandstone and, to a lesser extent, within altered andesite sills and dikes. Magnetite skarn generally hosts the better mineralization, especially in the upper oxidized portions. Grades are highest close to the contact of the reactive sedimentary rocks with the central intrusive complex.

Supergene weathering and mobilization of copper has developed a stratification subparallel to the current surface topography of enriched copper-gold-silver grades to roughly 300 metres below surface in both porphyry and skarn zones. The mineral zonation is clearly seen in core where upper portions are completely altered to clay with iron and copper oxides, transitioning down to mostly weakly altered rock with oxides primarily in fractures and faults, with the oxides diminishing with depth to where sulphides are preserved in fractures. The skarn is as deeply weathered and oxidized in places as the sedimentary and intrusive units with similar copper oxide minerals. However, the oxide-sulphide boundary is more complex within the skarn and controlled more by host lithology, with the coarse sulphides only partially converted to secondary minerals and extending closer to the surface, especially within calcareous units. Within thicker limestone beds, copper occurs mainly as fracture-controlled malachite or is confined to porphyry sills and dikes. The oxidation extends along sandstone and intrusive units well below the limestone on the east flank, indicating acidic oxidizing fluids migrated down and east from the ridge.

Copper and related gold-silver-molybdenum mineralization at Escalones occurs as skarn and porphyry types, as copper oxide (primarily chrysocolla), sulphate, and carbonate (malachite and azurite) down to approximately 3,400 metres elevation and along structures to 3,300 metres and transitioning at depth to chalcopyrite, chalcocite, bornite, and covellite. High-grade copper-oxide and copper-sulphide skarn mineralization forms the resistive high ridge at Escalones Alto and attracted the first exploration efforts and small-scale production from limited workings.

Porphyry mineralization is associated with moderate to intense potassic alteration (as secondary biotite) in the granodiorite. In general, potassic-altered hornfelsed shale/sandstone along both western and eastern flanks of the central intrusive complex hosts lower copper grades than the granodiorite and dacite porphyry hosts.

Enriched, oxidized porphyry mineralization is expected to continue under the southern extension of the lithocap, called the “Mancha Amarilla.” This area of gossanous argillic alteration extends over one kilometre to the south but has not been drill tested and only recently sampled at surface. Porphyry mineralization is also open to the west, between the western edge of the Meseta to the Escalones Bajo fault zone. Surface sampling indicates the fault zone is mineralized as well and may host higher-grade mineralization.

Skarn mineralization peripheral to the porphyry along the upper eastern margin (Escalones Alto) comprises mostly magnetite, garnet, and pyroxene skarn developed within sandstone, carbonate, and calcareous shale near contacts with intrusive rocks, with typical coarse copper oxides and carbonate near surface, transitioning to chalcopyrite-pyrite at depth. Finer disseminated and fracture-controlled mineralization occurs within biotite hornfels with quartz stockwork in steeply east-dipping hornfelsed calcareous shale and fine sandstone and, to a lesser extent, within altered andesite sills and dikes. Magnetite skarn generally hosts the better mineralization, especially in the upper oxidized portions. Grades are highest close to the contact of the reactive sedimentary rocks with the central intrusive complex.

The main skarn horizon forms the sharp ridge with the best mineralization at surface and dips steeply to depth under barren carbonate rocks to the east and north. The mineralization changes from garnet-magnetite-pyroxene skarn along the ridge crest to more of a calcsilicate assemblage within sandstone and shale and numerous feldspar porphyry sills. Extensive rock chip sampling of the outcrops returned wide intervals of significant copper oxide mineralization; the upper strata nearer the transition to overlying limestone were more reactive and are better mineralized.

The Escalones Copper Project will employ conventional open mining techniques using front end loaders, hydraulic shovels, and rear dump rigid frame haul trucks. The mineralized material would be treated using heap leach. The mine plan is designed to deliver an average of 50,000 tonnes of heap leach material per day. The average daily waste production rate over the life of the mine would be 54,000 tonnes per day. Waste rock would be placed in a waste rock storage facility.

Pit Design
Ms. Lane of GRE used a triple bench format consisting of triple 10-metre vertical benches with a horizontal 13-metre catch bench every three vertical benches.

Pit Design Parameters:
- Max Inter-ramp Angle Hard Rock - 50 degrees;
- Max Bench Face Angle - 68 degrees.

Haul roads were designed with a minimum width of 34 metres and a maximum gradient of 10%. Haul ramps and roads have been designed to accommodate two-way traffic using 227-tonne haul trucks, water diversion ditches, and safety berms. Minor sections were narrowed to a single lane of 17 metres and a maximum slope of 15%.

Drilling Blasting
The process material and waste rock material would be drilled and blasted using a rotary crawl driller and ammonium nitrate fuel oil (ANFO). The till waste material would not require drilling and blasting.

Loading and Hauling
The blasted rock and till would be loaded with 20-cubic metre capacity front end loaders and hydraulic shovels into 227-tonne capacity haul trucks. Mineralized material would be hauled to the primary crusher, and waste material would be hauled to the waste storage facility.

Waste Storage
Waste material would be stored in the waste storage facility located west of the pits in the adjacent valley. This location was selected to minimize hauling distances and disturbed acreage. Approximately 210 million loose cubic metres of waste would be mined and placed into the waste rock storage facility. An additional 170 million loose cubic metres of waste from haul road and leach pad construction would also be placed into the waste rock storage facility. The waste storage facility would be engineered to have overall final 3H:1V ultimate slopes.

Heap Leach
The heap leach facilities would be located south of the Maipo River immediately south of the project area. Ms. Lane of GRE has designed the structure with a maximum capacity of 229 million tonnes. The heap leach facility would be constructed by stacking lifts to a maximum height of 100 metres and with overall final 3H:1V ultimate slopes.

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The process for the Escalones project is comprised of conventional sulfuric acid heap leaching followed by solvent extraction and electrowinning to produce cathode copper. The target production rate is 50,000 tonnes per day of mineralized material producing an average of 52,000 annual tonnes of Grade-A copper cathode (115 million pounds). The estimated average copper extraction from the mineralized material is 72.5%.

The heap leach would consist of a suitable area lined with a solution containment system, typically a linear low-density polyethylene (LLDPE) liner with a rock over liner of sized material to facilitate drainage. Within this over liner would be placed drainage pipes to conduct the leach solution to the centralized collection ponds. The crushed material would be stacked in lifts on the lined pad by means of a slewing stacking conveyor. The lifts are targeted at 10 metres (32 feet) in height with a total heap height of 100 metres (328 feet). Once a suitable area ........