The Sierra Gorda copper-molybdenum-gold deposit is a typical porphyry deposit located within the Late Eocene to Early Oligocene Metallogentic belt as defined by Sillitoe.

Two principal lithologic units occur in the Sierra Gorda mining district: An Early Cretaceous volcanic sequence composed of andesites, rhyolites and some associated sedimentary rocks, such as tuffs and volcanically derived sandstones and siltstones; and a Tertiary Batholith occurring as intrusives of variable composition, texture and morphology, including equigranular and porphyritic rocks presenting a radiometric age of about 63 to 57 million years.

Strong hydrothermal alteration occurrences are associated to Tertiary intrusive dykes and apophysis within the Sierra Gorda mining district. The alteration zones occur as halos surrounding breccia zones which are associated to intrusive rocks. Several breccia zones outcrop and have been identified within the Sierra Gorda area, including the Salvadora, Isabela, Isabela Norte, 285 Zone, Catalina and 281 zone.

Sierra Gorda Project mineralization occurs as hypogene sulfides or primary mineralization, as leached oxides or secondary mineralization and as supergene or secondary enriched mineralization.

The hypogene sulfide mineralization forms the bulk of the known mineralization, both in terms of volume, as well as contained metal. Hypogene copper sulfides consist dominantly of chalcopyrite (CuFeS2), although bornite (Cu5FeS4) has been locally recognized as an accessory. Chalcopyritemineralized rocks exist from below the leached zone to the current limits of drilling, more than 1,000 m below the surface. Hypogene molybdenite (MoS2) occurs in distinct bodies within breccia zones at Catalina and Salvadora; elsewhere it is weak to absent. Gold typically accompanies the copper sulfides.

Leached/oxide zone is the product of “in situ” oxidation of the hypogene sulfides. The leached zone extends from the surface to variable depths of up to 200 m and is grouped into copper-rich zones and copper-leached or barren zones. The most important copper oxide minerals are the following: Atacamite (Cu2Cl(OH)3), Brochantite (Cu4(SO4)(OH)6), Chrysocola ((Cu,Al)2H2Si2O5(OH)4.n(H2O)3), and Vermiculite (Mg,Fe2+, Al)3(Al,Si)4O10(OH)2.4(H2O). Hypogene molybdenite is typically oxidized to ferrimolybdite (Fe3+ 2(MoO4)3.7(H2O)), powellite (CaMoO4), and grenite (Cu3(Mo)4)2(OH)2).

Supergene copper sulfide zone is an irregular zone of secondary copper sulfide enrichment, dominated by the mineral chalcocite (Cu2S). It has a variable thickness of 10 m to 150 m and it generally occurs at the boundary between the oxidized zone and the hypogene zone, but can exist well down into the hypogene zone or some distance up into the oxide zone depending on structural conditions.

Generally the copper minerals occur as disseminations and in veinlets, while the supergene copper sulfides are found coating pyrite or chalcopyrite grains. Molybdenum occurs mainly within breccia zones and disseminated.

The Sierra Gorda project is a large low-grade copper deposit; therefore, it will utilize high production rates, and the use the largest mining equipment currently available. Truck-shovel mining has been selected and it will utilize 55 m3 nelectric cable shovels, 300-tonne haul trucks, and electric production drills.

Processing ore from the Sierra Gorda deposit poses no special difficulties. The principal ore minerals are chalcopyrite and molybdenite and are fairly coarse grained. Even though the grade of the ore is relatively low, 0.39 percent copper, 0.024 percent molybdenum and 0.065 g/tonne gold, it is possible to obtain good recoveries and concentrate at a fairly coarse grind.

The process facilities will incorporate crushing, grinding, flotation, concentrate filtering and tailings dewatering and disposal for recycling. Filtered copper concentrates are stored and will be loaded into rail cars for shipment to the port. Molybdenum concentrates will be filtered, dried and bagged for shipment off-site by truck to the markets.

Dewatered and dried concentrate containing 8 percent to 10 percent moisture will be discharged by gravity to an 6,400-tonne capacity covered storage area below the filters. The stored concentrate will be loaded by front-end loader into sealed tipper railway cars or road trucks for shipment to the port or a local smelter. Each container will be sampled, and the tare and loaded weight for each container and the noverall weight will be recorded.

An additional emergency concentrate storage area of approximately 15,000-tonne capacity will allow for potential shipping delays, as well as provide some storage and blending of off-specific concentrate. This emergency area will be made on a bed of compacted tailings and will remain uncovered. Concentrate will be moved to and recovered from the emergency storage area by front-end loader. This area should be tracked for air quality assessment purposes.