The Shafter silver deposit is considered an example of a polymetallic replacement deposit. Because of their irregular, but sharp contact with the enclosing carbonate host rocks, deposits of this type have been categorized as high-temperature, carbonate-hosted deposits.

Polymetallic deposits consist of massive lenses and (or) pipes, known as mantos or replacement orebodies, and veins of iron, lead, zinc, and copper sulfide minerals that are hosted by and replace limestone, dolomite, or other sedimentary rocks; most massive ore contains more than 50 percent sulfide minerals. Sediment-hosted ore commonly is intimately associated with igneous intrusions in the sedimentary rocks. Emplacement of these intrusions triggered ore formation and they host polymetallic veins and disseminations that contain iron, lead, zinc, and copper sulfide minerals. Some polymetallic replacement deposits are associated with skarn deposits in which host carbonate rocks are replaced by calc-silicate±iron oxide mineral assemblages. Most polymetallic vein and replacement deposits are zoned such that copper-gold ore is proximal to intrusions, whereas lead-zinc-silver ore is laterally and vertically distal to intrusions.

The mineralized material consists of a massive aggregate of medium-grained, vuggy silica stained with varying amounts of iron and manganese oxides. Mineralogy is fairly consistent within the district. The mineralization originally consisted of sulfide minerals, which are now almost thoroughly oxidized. Secondary minerals include iron and manganese oxides, acanthite, hemimorphite, descloizite, embolite, plumbojarosite, cerargyrite, native silver, cerussite, anglesite, and small amounts of covellite, chrysocolla, and possibly other copper minerals. Primary minerals include dolomite, calcite, quartz, pyrite, sphalerite, galena, argentite, chalcopyrite, covellite, molybdenite, and tetrahedrite. Silver occurs predominately as oxidized acanthite in fine-grained aggregates of quartz, calcite, and goethite, with lesser dolomite, hemimorphite, willemite, anglesite, galena, smithsonite, and sphalerite. Lead and perhaps zinc appeared to be more plentiful relative to silver in the outlying mines of the district than in the Presidio mine, although the outlying mines are scattered and were poorly developed so generalizations are difficult.

Mineralization occurs over a 13,000 ft east- northeast strike length, is up to 1,200 ft across, and is generally 10 to 20 ft thick. The resource is at a depth of less than 100 ft in the west- central portion of the deposit and then gradually deepens to a depth of more than 1,000 ft within the eastern end of the deposit following the general stratigraphic dip. Manto thickness and silver grades can be highly variable, often related to near-vertical structures that served as fluid conduits and/or structural traps.

Although silver mineralization is generally continuous along the 13,000 ft length of the deposit, the resource is fragmentary in the vicinity of the historic Presidio mine due to the removal of mined-out material, as well of west of the historic Presidio mine in the area more recently mined by Aurcana.

The relatively sub-horizontal geometry and the thickness of the mineralization suggested the use of room and pillar as the primary mining method. Longhole slashing, benching and partial pillar recovery would be employed as needed during the secondary extraction phase. A minimum mining height of 8 ft was included in the resource modeling to allow sufficient height for personnel and mechanized equipment. Areas with thickness over 15 or 20 ft can be mined using the secondary extraction methods listed above, or another variation of conventional room-and-pillar mining.

Mine design for primary extraction is based on 6.8 oz Ag/ton cutoff grade. Block grades for the stopes is the block diluted grade of the 10 ft x 10 ft x 8 ft block with a cutoff of 6.8 oz Ag/ton. The minimum mining height is 8 feet with basic heading size of 28 ft wide. Average height for the above cutoff resource base is 12 ft. Stopes were formed by successive re-blocking of the block model at higher cutoffs. The average stope width is estimated to be 140 ft from the selected resource blocks. Pillars are planned to be 24 ft by 24 ft. These stope dimensions yield a primary extraction ratio of 78%. Secondary extraction involve mining half of the pillars. Overall extraction increases to 89%, assuming half the pillar marterial is recoverable.

Once the primary extraction sequence in each work area is complete, secondary extraction would include combinations of: slashing pockets of back material, benching floor areas that meet cutoff, slashing of ribs, and partial pillar recovery. Once pillar recovery starts the stope areas would only be accessible with remote controlled equipment.

Mining areas considered in this study are Presidio, Lower Presidio, West Shafter and Shafter Main. West Presidio is excluded due to uncertainty around the mined-out areas. Opportunities exist to add minable material to the plan if this area can be rehabilitated and delineated.

All mine development and production rock will be hauled up the Presidio decline to surface with rubber tired equipment. The opportunity exists to lower costs slightly by storing waste rock in mined-out workings.

The Goldfields shafts (#1 and #2) are only planned for ventilation use during the expected mine life. It is possible that these shafts could be rehabilitated and used for hoisting men and mined material, but a detailed cost estimate for this and tradeoff study would be needed to evaluate this possibility.

The production plan is based on 350 days per year at 600 tons per day or 210,000 tons per annum.

The Shafter mine processing facility proposed in this study will use whole-ore cyanide leaching to extract silver from the mineralization. Metal recovery will be accomplished using a standard counter current decantation (CCD) and Merrill Crowe method. Run-of-mine (“ROM”) material will be crushed to a nominal 1 inch size using a single jaw crusher for primary crushing and a cone crusher in closed circuit with a product screen for secondary crushing. The crushing plant will operate on a single 12 hour shift, seven days a week, to replenish the crushed mill feed stockpile. The stockpile will have enough capacity to feed the milling operations, which will operate continuously with two, 12-hour shifts, 24 hours/day and 7 days a week.

Milling to the final leach feed product size of 80 percent passing 74 microns will be achieved by a single ball mill in closed circuit with cyclones for classification. Cyclone overflow will feed into a pre-leach thickener. Thickened slurry, at 68 ........