The deposits at Diablillos, are high-sulphidation epithermal silver-gold deposits, derived from activity of hydrothermal fluids in a relatively shallow environment, often associated with fumaroles and hot springs. The principal mineralizing process is by convective flow of meteoric waters driven by remnant heat from intrusive activity at depth, often related to copper porphyry systems. The term “high-sulphidation” refers to the conversion of magmatic SO2 in aqueous solution into H2SO4 and H2S resulting in a highly acidic environment responsible for the diagnostic assemblage of alteration facies typically seen in these deposits. Mineral occurrences are structurally and hydrostatically controlled, with deposition occurring as open space filling at or near the level at which boiling occurs. As such, they characteristically subtend a limited vertical range, except where cyclical healing and failure of fractures results in up and down migration of the boiling zone.

MINERALIZATION
There are several mesothermal, and epithermal precious and base metal occurrences situated along the trend of the Diablillos - Cerro Galán fault zone within the northern and central Puna, including Diablillos, Incahuasi, Cóndor Yacu, Inca Viejo, and Centenario. Many of the mineral occurrences are spatially, and probably genetically, related to small Tertiary stocks and extrusive domes that are usually hydrothermally altered with disseminated and vein-hosted lead, zinc, silver, and gold (± ........

The proposed Diablillos Project consists of open pit mining at the Oculto deposit, which has 18 months pre-stripping and sixteen years of production at a strip ratio of 3.6. Total material moved will be 17 Mtpa during initial stripping decreasing to 3 Mtpa at the end of the mine life. The open pit is designed to feed the processing plant at 7,000 tpd.

The Oculto deposit is considered for open pit mining to be carried out by contractor as a conventional truck and shovel operation. Contract mining was considered over owner operations to accommodate variable annual material movement quantities and flexibility in mobile mining equipment fleet sizes. This option also reduces up-front capital expenditures associated with mobile mining equipment purchases.

It is contemplated that the mining contractor would undertake the following activities:
• Drilling performed by conventional hydraulic production drills.
• Blasting using a downhole delay initiation system.
• Loading and hauling performed with trucks and shovels.
• Production support using bulldozers, graders, and water trucks.

AbraSilver would supervise mining operations with its own employees including mining engineers, geologists, surveyors, and support staff. The rock mass at Oculto has been considered to require drilling and blasting. It should however be noted that unconsolidated scree will represent a material amount of early stripping material. As this will not require d ........

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