The Scotia Mine Deposit mineralization has long been considered a Mississippi Valley-type (“MVT”) lead zinc deposit (MacEachern and Hannon, 1974). Characteristics of sedimentary formations that host MVT lead zinc mineralization include shallow-water, shelf-type carbonate rocks with reefs around the peripheries of intracratonic basins, karst structures, limestone-dolomite interfaces, and proximity to a major hydrocarbon-bearing basin.

At the Scotia Mine Deposit, textures (including fossils) have been preserved; representing volume- for-volume replacement of original limestones by dolomite, and the sulphides are, in turn, replacements and porosity fillings within the previously altered host rocks. Kontak (2002) feels that petroleum in fluid inclusions in the Scotia Mine Deposit mineralization suggest a role of hydrocarbons in the mineralising process, like many MVTs, but Sangster and others (1998) point to basement rocks underlying the Palaeozoic sedimentary rocks as the source of the mineralising fluids.

Locally, the Scotia Mine is located in the Gays River Geological Formation, part of the Windsor Group of Carboniferous aged rocks.

The carbonates of this formation started growing in a warm sea of Carboniferous age when the ocean invaded the Maritime Basin 300 million years ago. The carbonate host is an algal bank-coral reef that grew along an anticlinal fold in the older Cambrian-Ordovician rocks, which were folded by compressional forces during the Taconic orogeny 440 million years ago. The carbonates formed a barrier between the two basins. To the Northwest was the Shubenacadie Basin and to the Southeast was the Musquodoboit basin. The Goldenville anticline’s slope is controlled by bedding and jointing. The base metal deposit is on the north side of the anticline, where the Goldenville rocks dip between 43° and 46° to the north. The strike of the beds is between 085° and 090°.

There are three main zones of mineralization within the deposit: the Main Zone (formerly Gays River deposit), the Getty Zone, and Northeast Zone. The Main Zone lies along the Southside of the Gays River, immediately east of the confluence with the Gays River South Branch. The Getty Zone lies just northwest of the zone on the western side of the Gays River. The two Zones are separated by less than one kilometre.

Main Zone Mineralization
The base metal is controlled by initial porosity. The mineralizing fluids chose the channel ways through the coral gardens. The most likely source of a channel way is a change in the direction at the reef crest, where joint controlled slopes meet. Galena is generally in veins and in fractures. There is some dissemination through the smaller openings in the rock.

Once over the coral mound, the mineralizing fluid travelled along sheets of skeletal debris and dolomite sand. Thus, in the reef proper, the mineralized beds are generally flat-lying to gently dipping (16°SE around the portal). Secondary mineralization is also open space-filling. The open spaces probably were caused by several uplift periods. A minor amount of marcasite and zinc oxide is present in fractures of the carbonate near the surface and in the outcrops near the confluence of the Gays River and South Branch Gays River.

Nesbitt Thomson Inc. (1991) describes high-grade mineralization as consisting of a massive sulphide zone in contact with the evaporite or Trench, ranging in thickness from 0.1 to 5.0 metres and locally containing up to 78% Pb and 57% Zn. On the footwall of the massive sulphide, there is a zone of disseminated material (>7% Zn equivalent) which, in places, is up to 12 metres in thickness. Locally disseminated mineralization (>2% Zn equivalent) extends up to twenty metres into the footwall. The parameters used to calculate “Zn equivalent” are unknown but would have reflected the prices of zinc and lead at the time.

A sinuous paleo coastline essentially controls the Main Zone. The main part of the deposit is shallow (generally <150 m deep), has a dip length of approximately 100 m and a strike length following the paleo coastline over a straight-line distance of 2 km (Nesbitt Thomson Inc., 1991).

The mineralization at the Main Zone consists of massive and disseminated ore hosted predominantly by the carbonate rocks, with extensions down into the basal breccia unit. Massive sulphide mineralization consists of fine-grained beige-coloured sphalerite and medium to coarse-grained galena (Kontak, 1998; Savard and Kontak, 1998). The massive mineralization is restricted to the carbonate-evaporite contact and is 1 to 3 metres thick.

Disseminated mineralization fills in primary porosity in the dolomitized carbonates and walls of primary cavities (Kontak, 1998).

Sphalerite and galena constitute about 99.5% of metallic minerals. Other sulphide minerals are marcasite, pyrite and chalcopyrite, while gangue minerals include calcite, dolomite, fluorite, barite and selenite (Patterson, 1993).

Getty Zone Mineralization
The Gays River Formation mineralization has long been considered a Mississippi Valley-type lead-zinc deposit. This type of deposit is carbonate-hosted, classified as a typical open space filling type, and hosted in a dolomitized limestone. The limestone developed as a carbonate build-upon an irregular pre Carboniferous basement topographic high where conditions allowed for growth of reef-building organisms.

The zinc/lead-bearing Gays River Formation trends in an east-north east direction across the Property. Locally, the mineralisation dips up to 45º on average, and up to vertical in places, to the north northwest which is the depositional slope of the front of the Gays River reef unit. The dip tends to be horizontal in the back reef area (south of the main trend). The mineralisation is present as sphalerite and galena and grades from massive Pb-Zn mineralized material in the fore reef to finely disseminated, lower grade material in the back reef. In the mine area, the Gays River Formation is overlain either by the evaporites of the Carroll’s Corner Formation and/or overburden.

Gypsum
Gypsum is an evaporite, a class of rocks that precipitate when water evaporation keeps pace with water input. Block faulting during the early Carboniferous lowered the land relative to the sea. Slowly, water invaded the area. The marine invasion led to carbonate-based life forms such as coral to establish colonies along the edge of the ancient sea. As the temperature and salinity of the water increased, gypsum, anhydrite and halite, and some other salts precipitated out as the sea dried up. Anhydrite is deposited directly from the evaporation of sea water at a temperature of 42°C or higher or at lower temperatures with increased salinity. At lower temperatures, gypsum is deposited. (Berry and Mason, 1959). Gypsum precipitates as a hydrated calcium sulphate (CaSO4 · 2H2O). Gypsum has a hardness of 2 on the Mohs scale, between talc and calcite, so that one can scratch gypsum crystals with a fingernail. Pure gypsum has a density of 2.3 tonnes per bank cubic metre and a bulk density of 1.6 tonnes per cubic metre. In the arid environment of the time, gypsum accumulated in thick beds over a long time. The sea water evaporated in cycles. Halite (NaCl common salt) and other mineral salts precipitated out as the sea dried up.

The Scotia Mine deposit covers a total strike length of approximately 4 kilometres, with some surface constraints in between, and a vertical distance of approximately 120 metres. All mining is from open-pit operations with an expected mine life of approximately 14 years.

The Scotia Mine mineral resources will be extracted using conventional load and haul (truck & shovel) mining methods as determined by optimized pit designs and life-of-mine schedules. Mining operations will be completed using an owner/operator of excavators, loaders, haul trucks and ancillary support equipment as well as some rental equipment. Equipment requirements have been determined based upon required production rates and haulage cycles.

The open-pits will be mined on 5-metre-high benches with double benching being utilized on the lower, which are primarily comprised of fair to good quality. Drilling and blasting are only required for 40 percent of the total material mined over the life of mine plan, which accounts for all of the hard rock to be mined from the pits. The remaining 60 percent is largely comprised of overburden and has been proved to be free digging material based on past operations and will not require blasting. Drilling and blasting will be performed using contract services.

The ultimate pit design was broken down into 6 phases to optimize development sequences and production requirements. Ore and waste tonnages, as well as Zn and Pb grades, provided by each open pit phase. Waste has been subdivided into overburden, gypsum, and carbonate waste rock. Inferred resource material inside the ultimate pit design has been included as carbonate waste rock and totals approximately 1,450,000 tonnes at 1.5% Zn, 0.7% Pb.

Waste removed from the open pits will consist of four materials: overburden, gypsum, Meguma basement rock, and carbonate waste rock. Waste storage will consist of a combination of backfilling the mined pits and stockpiling in the waste dump. The waste dump will consist primarily of overburden. Mineralized carbonate waste will be stockpiled in the waste dump separately for possible future use later should economics and commodity prices improve.

Gypsum will also be segregated within the waste dump when possible in the event the company decides to try and market the gypsum. All Meguma waste will be processed as road rock and placed on the haul roads. As the pits are developed and mined to completion they will be utilized as backfill locations.

Using the Ultimate Pit Designs and the pit phase sequencing, a Life-Of-Mine (LOM) mining schedule was developed by month and is based on operating 24 hours/day, 365 days/year. The LOM production schedule is based on providing a mill feed of approximately 1,000,000 tonnes per annum at an average zinc equivalent grade of 3.00%.

The average head grade for the mill over the LOM is approximately 2.0% Zn and 1.0% Pb.

The average size of the total ore stockpile for the LOM is approximately 180,000 tonnes. The largest the total ore stockpile gets during the LOM is 430,000 tonnes. The smallest the total ore stockpile gets during the LOM is 30,000 tonnes.

The open pit mining operations will be performed as owner/operator. All mining equipment will be leased or obtained under a rental purchase option (RPO).

Drilling and Blasting activities at Scotia Mine will be done by a local contractor. Drilling will be performed using standard hydraulic drills. Holes will be drilled 4.5 – 5.5 inches in diameter using square and staggered drill patterns where applicable. Controlled blasting practices will be utilized on final bench walls. Blasting will be done in 5-metre bench lifts where possible. Due to the presence of underground workings throughout the Main Zone of the ultimate pit, it will be necessary in some instances, due to safety considerations, to blast 10 metre and muck material in 5-metre lifts. The underground workings have been surveyed and modelled and, from past open pit operations, have proven to be extremely accurate.

Gypsum Assessment
From the Scotia Mine restart study, a total of 5,100,000 tonnes of evaporate (Gypsum + Anhydrite) was planned to be mined from the LOM pit. This results in an Anhydrite:Gypsum ratio of approximately 3.5:1 within the LOM pit. During previous open pit mining operations, Gypsum and Anhydrite was hauled to the dump as waste. Some Gypsum was also used as road base material for temporary roads.

The current PFS LOM pit has approximately 31 million tonnes of evaporite (gypsum + anhydrite) scheduled to be extracted, with a NI 43-101 mineral reserve of 5 million tonnes of gypsum with an average grade of 91.8%.

An area has been demarcated for stockpiling Gypsum for sale and/or processing. ScoZinc is considering the merits of upgrading its gypsum mineral reserve with a calcination plant to produce a specialty calcined product (for example, Plaster of Paris).

Stockpiling & Crushing
The crushing circuit is designed for an annual operating time of 5,256 hours per annum or 60% availability. Material is hauled from the mine to stockpiles. Provision for dumping on the ROM pad for blending and rehandling into the mobile jaw crusher feed hopper is provided. Material from the mobile jaw crusher (P80: - 70mm) is crushed further by a new secondary cone crusher (P80: -40mm). The secondary crusher product then feeds a new sizing screen (6’x12’ double deck). The oversize from the new sizing screen feeds an existing cone crusher (formally the existing Secondary Crusher) to produce a final tertiary crushed product (P80: -14.5mm). The crushed material is conveyed to an existing Fine-Ore-Bin that provides approximately 10 hours of live storage. Given the milling operation is designed for an annual operating time of 8,059 hours per annum or 92% availability, this will result in excess crushed material production when the crusher is operational. The excess crushed material will allow routine crusher maintenance to be carried out without interrupting feed to the mill.

The Fine-Ore-Bin discharge area is equipped with 2 upgraded belt feeders to regulate feed at 122 t/h onto the rod mill feed conveyor.

The material handling and crushing circuit includes the following key equipment:
• Mobile Jaw Crusher;
• New Secondary Cone Crusher;
• New Sizing Screen;
• Upgraded Conveyor Belt Drives & Pullies;
• Existing refurbished Tertiary Crusher (Formally the Secondary Crusher).

Grinding Circuit
The grinding circuit consists of a rod mill followed by two ball mills in closed circuit with a new cyclone pack. The circuit is sized based on a cyclone overflow 80% passing size (P80) of 110 µm. The rod mill slurry discharges through a trommel screen into the cyclone feed pump box. The ball mills are fed by the cyclone underflow. The cyclone underflow launder is split to feed the two different sized ball mills. The ball mill discharges through a trommel and the oversize is screened out and discharged to a scats chute. Trommel undersize discharges into the cyclone feed pump box. The former regrind mill discharges through a trommel and the oversize is screened out and discharged to a scats chute. Trommel undersize is pumped to the cyclone feed pump box. Water is added to the cyclone feed pump box to obtain the appropriate density prior to pumping to the cyclones. Cyclone overflow gravitates to a new cyclone Over-Flow feed tank and then pumped to the Pb conditioner tank.

The grinding circuit includes the following key equipment:
• Existing 300 kW rod mill;
• Existing 670 kW ball mill;
• Existing 197 kW ball mill;
• New cyclone feed pump box;
• New hydrocyclones.

Per the mining production schedule, as the blended low-grade ore will be fed to the mill in the Life of Mine (LOM) which is 14 years. The project will utilise a more capital cost-effective mill design, including a grind of 110 µm at 2,700 t/d.

Key process design criteria are listed below:
• Max throughput of 2,700 t/d or 0.98 Mt/a;
• Lead head grade of 1.1% and zinc head grade of 2.39%;
• Crushing plant availability of 60%;
• Grinding and Flotation plant availability of 92%;
• Dewatering and concentrate handling availability of 85%.

The Process design is comprised of the following circuits:
- Primary, secondary and tertiary crushing circuit;
- Fine-Ore-Bin to buffer throughput to the grinding circuit;
- Rod mill with trommel screen followed by 2 ball mills with cyclone classification (1 of the ball mills is the former re-grind mill);
- Pb and Zn flotation circuit;
- Pb and Zn dewatering circuit;
- Tailings dis ........