The Caballo Blanco property and Almaden Minerals neighboring El Cobre property includes at least two distinct deposit types, defined as high-sulphidation epithermal gold and porphyry copper gold respectively.

The Caballo Blanco property lies at the eastern end of the Trans Mexican Volcanic Belt and is underlain by sub-aerial basalts, andesites and diorite dykes of Miocene age that are in turn covered by a sequence of felsic quartz tuffs, andesitic ‘dome’ complexes, volcaniclastics and younger intrusive dacitic plugs. Capping the volcanic package are Pliocene alkaline basalt flows that are commonly well preserved as small flat highland plateaus.

At least two large areas of epithermal precious metal occur within the current Caballo Blanco property, referred to as the Northern Zone and Highway Zone. Mineralization is confined to altered varieties of upper Miocene andesitic domes and dacitic intrusives.

In the Northern Zone and Highway Zone, gold mineralization is associated with vuggy silica breccia surrounded by large and distinct haloes of various mixtures of clay alteration including alunite, dickite, and pyrophylite. The elongate and silicified gold rich mineralization at La Paila likely formed from fluid rising along a north trending fault structure well above a deeper intrusive ‘heat source’. It is interesting that similar silica and clay alteration zones and or soil anomalies have been recognized at La Cruz, Red Valley and Highway Zone, all of which lie along a north-south linear trend greater than nine kilometers in length.

It is proposed that the La Paila deposit is amenable to be developed as an open pit mine. Mining of the deposit is planned to produce a total of 49.3 million tonnes (Mt) of heap leach feed and 81.8 Mt of waste (1.7:1 overall strip ratio) over a seven and a half year mine operating life. The current life of mine (LOM) plan focuses on achieving consistent heap leach feed production rates, mining of higher grade material early in schedule, and balancing grade and strip ratios.

The mining sequence was divided into a number of stages designed to maximize grade, reduce pre-stripping requirements in the early years and maintain the heap leach at full production capacity.

The open pit mining activities for the Caballo Blanco pit were assumed to be primarily undertaken by a mining contractor as the basis for this preliminary economic assessment. An operating bench of 10 meters was assumed for the preliminary mine planning.

The fleet has an estimated maximum capacity of 70,000 t/d total material, which will be sufficient for the life-of-mine (“LOM”) plan.

Two hundred and fifty millimeter diameter blast hole drills are planned to perform the majority of the production drilling in the mine (both mineralized and waste rock), with the 165 millimeter diameter hydraulic drill to be used for secondary blasting requirements and may be used on the tighter spaced patterns required for pit development blasts. The main loading and haulage fleet is planned to consist of 90 tonne haul trucks, loaded primarily with the diesel-powered 15 m3 hydraulic front shovels or a12 m3 wheel loader, depending on pit conditions.

As pit conditions dictate, the D10-class dozers are planned to rip and push material to the excavators, as well as maintaining the waste dumps and heap leach pad.

The open pit work schedule is based on two twelve hour shifts per day, seven days per week, 365 days per year.

The crushing system is fed from 40 tonne end-dump haul trucks bringing run-ofmine (ROM) material from the pit.

ROM is fed to the crushing plant by end-dumping material directly into a dump hopper or by reclaiming material to the dump hopper from a ROM crusher feed stockpile. The dump hopper is equipped with a belt feeder discharging into a vibrating grizzly screen fitted out with 150 mm gratings.

Screen oversize discharges to a primary jaw crusher with a closed-side setting of 125 mm. Crushed particles are combined with the grizzly screen undersize forming a coarse product stream. Eighty percent of these particles will pass through the primary system at minus 140 mm, or P80 140 mm. The coarse product is moved to the next
stage of crushing via conveyor belt.

The conveyor belt moves coarse material from the primary crusher to a coarse ore storage bin which feeds the secondary crusher circuit. Coarse material is drawn from the bin by an apron feeder that feeds a transfer conveyor. This conveyor discharges to a vibrating double deck screen. A double deck screen increases the surface area presented to moving particles to maximize separation efficiency. The top deck scalps off particles larger than 78 mm and the second deck removes middling materials with sizes between 78 and 34 mm. The oversize materials are fed to a
secondary cone crusher with a closed-side setting of 34 mm. The screen undersize and the secondary cone crusher product discharge to a transfer conveyor feeding the product stockpile. Product size has a P80 of 38 millimeters. The stockpile has an 8-hour surge capacity of approximately 6,700 tonnes.

Pebble lime is added to the coarse material to control pH on the leach pad. The lime is added to the moving conveyor belt between the primary and secondary crushing circuits. The amount of lime is controlled using a rotary valve to regulate the amount of lime discharging from the silo to the conveyor belt.

Crushed material is transported from the stockpile to the leach pad by truck. Trucks are filled by a front-end loader that reclaims the crushed material from the stockpile. The initial lift is built by driving over a truck ramp built to accommodate the loading sequence. As the pad progresses, the truck ramp extends upwards to build subsequent lifts.

At the heap leach pad area, the haul trucks drive over the ramp and back up to a berm that marks the active edge of the leach pad cell. The trucks end-dump fresh material onto the heap leach pad. Bulldozers create the new lift by pushing the fresh material level, moving the berm out. Once the cell is built, the dozer rips the surface into furrows using a ripper attachment. Ripping the cell breaks up the compacted surface, reducing compaction caused by trucks.

The heap leach pad has both barren and intermediate irrigation circuits. Barren solution from the adsorption, desorption, recovery (ADR), plant is used to irrigate the previously leached material. The drainage from this portion of the heap reports to an intermediate leach solution (ILS) pond. The ILS pond and pumps recirculate the ILS solution to irrigate freshly stacked leach cells. Solution collected from new leach cells reports as pregnant leach solution (PLS) to the PLS pond. The area of the cells under leach using fresh barren solution are the same as the cells under leach using ILS solution, allowing the equal PLS and ILS flow rates.

Spray irrigation methods are preferred to promote evaporation. A large events pond and water treatment plant is provided to assist in managing storm events, especially during the wet season. In-heap storage is provided for the 100-year/24-hour storm event. PLS is collected via a piped drainage system installed at the base of the heap leach pad and directs solution to the PLS pond. PLS from the pond is pumped to carbon columns where gold is adsorbed onto the carbon surface. PLS flows through a series of five carbon columns by gravity and the carbon advances counter-current twice daily. Loaded carbon is stored in a bin until enough tonnage has been collected to begin the strip process. Regenerated carbon is advanced to the last carbon column. Barren solution discharging from adsorption flows across a safety screen, designed to catch fine carbon particles, then to a barren tank from which it is pumped back to the heap.

Cyanide addition and pH adjustment takes place at the barren solution tank. Cyanide is added to achieve a targeted concentration depending on metallurgical requirements, pH adjustments occur at the barren tank by adding slaked lime to the solution. Cyanide can also be added to the head of the carbon-column train.

Loaded carbon from the adsorption circuit is transferred from the storage bin to the acid wash vessel. The loaded carbon is washed using weak hydrochloric acid before stripping. The acid removes inorganic contaminants from the carbon surface, typically calcium. Once the acid-wash cycle is complete, the carbon is rinsed with fresh water to remove any excess acid residue and pumped to the elution vessel.

A pressurized Zadra process is used for gold elution. Hot caustic solution is circulated through the carbon elution vessel at low pressure to desorb the precious metals from the carbon surface, creating a rich electrolyte solution. Once stripping is complete, stripped carbon is pumped to a stripped carbon bin.

Stripped carbon can report to the carbon circuit or to the regeneration kiln. Regeneration is performed in a rotating kiln under reducing atmosphere to prevent burning the carbon. Carbon surfaces are re-activated during regeneration which removes organic accumulations. Organic contaminants can be indigenous but usually consist of hydraulic oils and fuel leakage from mechanical equipment.

The rich electrolyte solution from the elution vessel is pumped to the refinery where precious metal is recovered by electrowinning. Electrowinning is accomplished by inducing a current through the solution, reducing the metal ions which deposit onto stainless steel wool cathodes as sludge. The electrowinning process removes approximately 90 to 99 percent of metal from the electrolyte solution.

Lean, or barren, electrolyte reports to the barren-solution tank. Some of the barren solution is returned to the process and reused to strip carbon and some is bled back to the process. Refinery personnel will take electrowinning cells off line to remove deposited metal sludge by washing the cathodes using high pressure wash water.

The precious metal sludge slurry is collected in a holding tank and filtered using a plate and frame pressure filter. The filter cake is dried in a retort to volatilize and recover mercury that may have been collected during the leaching process. The dried metal sludge is mixed with fluxes and smelted in a high temperature furnace. The metal is poured into 500 ounce doré bars and the slag collected for further processing. The doré
is shipped to commercial facilities for refining.

Reagent makeup systems for cyanide, hydrochloric acid and caustic soda are included in the process design.