The deposits discovered by Orosur to date in the San Gregorio project area are considered to be typical of mesothermal vein-style, or orogenic-style gold deposits.

The deposits located along the east-west to northwest trending SGFS are, from west to east, the Santa Teresa deposits, the Polvorín deposit, the Ombú deposit, the San Gregorio deposit and the Arenal deposit. Zapucay and Argentinita deposits lie along the extension of the one fold and thrust fault system to the east, with similar age of SGFS.

Gold mineralization at SGGP has occurred as infill of brittle fractures within favourable host rocks such as zones of silicification and mafic units. Brittle fracture has occurred within these zones in response to local extensional tectonics created by the intersection of different trending faults, faults with dikes and changes in the attitude of the fault itself. Intense brittle fracture, silicification and quartz veining are apparent in higher grade zones. At least 3 phases of fracturing and veining can be recognised from drill core.

The gold deposits are generally hosted within basement granulite and amphibolite facies within the upper plate of a large thrust fault that defines the contact with the younger granites to the north. Pyrite is the dominant sulphide, and gold grade is directly proportional to the pyrite content. The gold at all deposits is fine, and visible gold is rare. Other potentially deleterious elements are in low concentrations.

The northeast trend to the mineralization is apparent within the granites to the north of the main thrust, where the Sobresaliente and Castrillón deposits are located. These deposits are approximately 5 km and 7 km north of the San Gregorio mine site respectively.

Open pit mining is performed by conventional open pit methods, using drill and blast techniques to break the rock, and then load it by excavator on to 50 tonne trucks to be transported to appropriate destinations. Historically, mining and hauling from satellite pits around San Gregorio was performed by contractors with smaller mining equipment to match the equipment size, to the size of the pits. Over the past years, contractor mining of satellite pits and ore haulage became a significant cost item for the Corporation. So, during 2012, Orosur decided to acquire its own fleet of smaller mining loading and hauling equipment. Total capital expenditure to acquire this fleet was approximately US$4.5M and was funded by a leasing contract to be repaid in 36 months.

Underground mining at Arenal started in April 2013. Mining is performed according to conventional Inclined Room and Pillars (IRP), and Transverse Stopping methods. That includes development drifting, long-hole drilling, charging & blasting and finally ore mucking out.

The TS method consists of primary and secondary stopes. Primary stopes measure 50m long by 20m high by 20m wide. Secondary stopes have the same maximum dimensions, but include a 6m internal pillar. An 8m wide pillar is located between the primary and secondary stopes. The pillars allow backfill material to consist solely of waste rock, without requiring any cement. The primary stopes have a drill drift driven along both side of the stope. The secondary stopes reduce the amount of development by only developing one central drill drift for each stope. Mining commences in the central primary stope on the lowest mineralized level and continues in adjacent primary stopes. A 50m long stope will be immediately backfilled following mining. Backfill is dumped from the drill drift into the empty stope using a load-haul-dump (LHD) unit. Following completion of the primary stopes, mining of the adjacent secondary stopes commences. This pattern of extraction will continue vertically until the mineralized zone is depleted.

The IRP method is used along the footwall of the ore zone where the ore is on average less than 10m thick. The method uses a production drift, which is driven to the end of the ore zone. These production drifts are driven up to 8m wide with a shanty back on the hanging wall side of the drift to minimize overcut dilution. Once the production drift is complete on the level, the stopes (above the production drift) are then mined retreating toward the level access drift. The stopes, between the development levels, are 7.5m high by 15m long, followed by a 10m long pillar. The pillar ensures stability of the area without the need for backfill, which helps keep the operating costs low for this mining method.

The ore treatment plant is a conventional carbon-in-leach (CIL) plant built by Minproc in 1996 and commissioned in January 1997. The plant comprises of a single-stage crushing circuit using a 500 mm aperture grizzly and a jaw crusher fed using a front end loader (FEL). The nominal crushed ore size is 100% passing 150 mm.

The crushed ore is reclaimed from the main stockpile using two ore feeders underneath the main surge stockpile onto a main feed conveyor and then fed into a 20 x 10 ft (D x L) semi-autogenous grind (SAG) and a 13 x 20 ft (D x L) ball mill circuit in an SAG/ball/crush (SABC) configuration. The SAG mill is in closed circuit with a scats crusher to prevent the buildup of critical sized material in the SAG mill. The ball mill runs in closed circuit with a bank of 15-inch hydrocyclones with cyclone underflow returning to the ball mill and cyclone overflow reporting through to the CIL circuit. The final product size target is 80% passing 150 µm.

The CIL ........