The mineral deposit that comprises the El Roble Project consists of mafic-type volcanogenic massive sulfide (VMS) mineralization for which there are numerous examples in the world.

At El Roble, current geologic thinking is that the basalt and chert-bearing sedimentary host rocks represent a fragment of a Late Cretaceous seafloor that was accreted to the South American plate. The position of the El Roble deposit is believed to be in the chalcopyrite/pyrite/pyrrhotite zone in the central “mound” area of the schematic section, which explains the apparent lack of banded textures commonly found in the distal portions of the deposit model.

Based on the large number of mafic-type VMS deposits (more than 1,000 in total) around the world and the current knowledge of the sizes of these, it is possible to estimate a typical size and metal content for these deposit types. Franklin et al. (2005) cite the statistical mean deposit size for 74 individual, mafic-type VMS deposits is 2.7 million tonnes (Mt) at 1.82% copper, 0.02% lead, 0.84% zinc, 1.4 g/t gold, and 10.62 g/t silver. The El Roble Project concession block covers a strike length of 10 kilometers of prospective ground, allowing substantial room for the discovery of additional clustered VMS deposits.

Other mafic-type VMS deposits in Colombia include Guadalupe (Antioquia), La Equis (25km from El Roble in Choco), Sababablanca (Valle de Cauca), and El Alacran.

The volcanogenic massive sulfide mineralization that comprises the El Roble deposit has been overturned by folding such that it now dips steeply to the east.

The presence of narrow local thicknesses (0.5m) of massive sulfides finely interbedded with gray to black cherts essentially confirms the syngenetic origin for the deposit. VMS mineralization continuity is locally disrupted by Tertiary andesite and latite dikes up to 10 meters in width that intrude both the VMS mineralization and the host rocks.

In hand specimen and in diamond drill core, the massive sulfide mineralization is fine-grained with little internal structure or banding, consisting dominantly of pyrite and chalcopyrite. Pyrite occurs as euhedral and subhedral grains that measure on average approximately 200 microns in diameter, but which can vary from 0.04 to 0.01 millimeters. Colloform pyrite textures and crushed pyrite grains are also common. Chalcopyrite typically fills spaces between pyrite grains, along with minor pyrrhotite and sphalerite, No other sulfide minerals have been identified. Gold occurs as electrum in 10 to 100 micron irregular grains in the spaces between pyrite grains. Minor silver is also present, presumably as a component of the electrum. Gangue minerals include quartz and chlorite along with lesser calcite, dolomite and minor hematite and magnetite.

In addition to massive sulfide mineralization, stockwork-type mineralization consisting of chalcopyrite with subordinate pyrite in massive veins and patches of sulfides occurring in veins dominated by quartz and chlorite recently has been intersected in exploration drill holes between the 2000m and 1980m levels.

The drift-and-fill mining method implemented to mine in Zeus continues to be successful. At the end of Q4-2015, the primary stopes on the 1837 sublevel had been completely filled and the next level above (1842 sublevel) successfully accessed on top of the rockfill. Stoping in the 1812 level was also completed; the second lift stopes on the 1817 level are now producing as per plans. Various stopes have now been mined and filled with no geotechnical or mining problems. Changes to the rockfill mix have increased the pumpability of the material without affecting strength characteristics. The drift-and-fill mining method continues to meet or exceed expectations regarding costs, safety, productivity and efficiency. Atico considers the implementation to be very successful.

The El Roble mine continues to operate at approximately 425 tonnes per day using mechanized cut-and-fill stoping methods with waste rock or cemented rock as back fill.

Recent production from individual massive sulfide lenses has totaled as much as 50,000 tonnes, although some mined were much smaller. The hanging wall and the footwall host rocks of the massive sulfide lenses can be sufficiently competent to support stope openings of 5m to 10m wide and strike lengths of 15m to 20m.

While earlier reports cite that the general thicknesses of VMS mineralization lenses mined by MINER prior to its acquisition by Atico decreased with depth from approximately 40m at the surface (2223m AMSL) to 15m at the 2000m level and 10m at the 1980m level, the Qualified Persons responsible for this amended Technical Report note that mining in the Zeus and Maximus deposits since Atico’s acquisition of MINER has revealed significantly wider widths (up to 60m).

Mineralization to be processed and waste are transported to the surface using 3- cubic-yard load-haul-dump units (LHD’s) that feed material to the 2000m main haulage level which is serviced by battery locomotive and 3-tonne mine rail cars. Raises connect the underground levels for ventilation and services (compressed air, water, electricity). A ramp between the 2000m haulage level and the lower 1950m level and the 1880m level provides access for mining of down-plunge extensions of the VMS mineralization lenses.

The existing processing plant at El Roble has been operated by MINER since 1990 and after recent upgrades has a rated nominal throughput capacity of 650 tonnes per day. The processing methods consist of conventional crushing, grinding, and flotation to produce a copper-gold concentrate. Grinding is to 80% passing 200 mesh for flotation feed. Four banks of six flotation cells each generate concentrates which are subsequently thickened, filtered and stored on site for shipping via highway truck to the Pacific coast port of Buenaventura. Process tailings are deposited in an impoundment facility situated along the banks of the Rio Atrato next to the processing plant, or in a separate tailings impoundment located downstream of the processing plant. Process waste water is decanted in a series of ponds and then released (at a pH of 10.2) into the Rio Atrato.