The Jinlonggou gold deposit lies within a low, north-west trending, mountain range (Tanjianshan) composed of Wandonggou and Tanjianshan Group rocks, with Early Palaeozoic gabbro intruding the Proterozoic rocks and Late Paleozoic porphyritic plagiogranite intruding all older units.

The Jinlonggou gold mineralization lies within Member 1 of Formation B of the Wandonggou Group. The host rock sequence is dominated by carbonaceous phyllites that commonly contain porphyroblastic chiastolite. The rocks are dark grey to black and display a well-developed foliation. In the central and southern parts of Jinlonggou, a number of orange brown sandstone bands are also present and act as key marker horizons.

Two intrusive rock types occur within the limits of the mineralization and are both of probable intermediate composition. The dominant intrusive is a fine grained phyllic altered diorite that is either light orange or light green in colour. The intensity of alteration has been used to sub-divide the diorites into three classes – D1, D2, and D3. Diorites where original textures are still visible are classified as D1, where partly obscured, D2 and where completely altered, D3. In some specimens earlier silicification has preserved some of the euhedral plagioclase phenocrysts. Acicular amphiboles (actinolite) are visible in D1 samples. The diorites have been further altered in areas of mineralization.

The second intrusive type is quartz-feldspar porphyry (QFP). It occurs as relatively narrow sill-like bodies within the mineralized zone. Original textures and mineralogy are typically visible with only minor phyllic alteration. It is a pale cream to white rock containing common feldspar phenocrysts, strongly altered to sericite and quartz, and ubiquitous subhedral to rounded quartz phenocrysts.

Both intrusive unit types occur above and below the T2 thrust but in quite different styles. Above T2 fault, the intrusives occur as steep (60°- 70°) SW dipping, SE trending thin bodies which clearly cut across the folded sedimentary units.

Qinlongtan mineralization is confined to a 50o -60o east-dipping fault zone within a sequence of carbonaceous phyllite, marble and minor intermediate and felsic porphyry intrusives. The fault zone is typically 5 m to 10 m wide, to a maximum of 14 m and is orientated approximately parallel to the primary layering which averages 60° NE 157°. Minor folds and fracture intersection linears plunge dominantly to the south at around 25° and control mineralization trends. There is little evidence of fault movement or brecciation. In addition to the main plane of mineralization, there is some evidence of a second, thin hanging wall zone, less than 1 m wide, intermittently mineralized with grades up to 5 g/t Au. No resources have been defined within this plane.

The main mineralized plane has been dexturally offset by two faults orientated 55° NW 025° and 65° NW 025° with lateral offsets of 30 m and 5 m respectively. Mineralization terminates abruptly at the northern end of the deposit (around section 16360 mN) and may be due to faulting. But the exact location and orientation of this structure has not yet been determined.

Gold is associated with pyrite and arsenopyrite in both of the host rocks, phyllite and diorite. Early replacement pyrite occurs within the chiastolite porphyroblasts and as tiny lenses and veinlets in the plane of the foliation. Replacement typically ranges from a fine dusting of pyrite to complete replacement on the inner and outer edges of the carbonaceous rims. Occasionally, the whole rim is replaced; the rim and internal carbon are replaced or the whole porphyroblast is replaced. Cutting all of these features but not displacing them are pyrite veinlets up to 0.2 mm in width. These are orientated at angles of 70o - 80o to foliation. The latest phase is pyrite veinlets of about the same width but orientated sub-parallel to foliation.

Pyrite within the diorite host is typically disseminated either as small aggregates of pyrite crystals or as individual fine grains. Veining occurs but as hair-thin fracture coatings to narrow, commonly anastomosing, veinlets.

Gold is hosted within the pyrite and arsenopyrite crystals. Minor amounts occur within quartz grains enclosed in pyrite. A strong relationship exists between gold and fine grained sulphide minerals. The two host rocks have behaved in a similar fashion in their ability to take up sulphide. Levels of the two sulphides agree quite well with those recorded originally by Q1.

Gold mineralization in the Jinlonggou deposit exhibits a strong structural control. Sulphide and gold mineralization are preferentially developed in a network of brittleductile faults. These faults have provided adequate pathways for fluid circulation, particularly in those trending 030° on the western side of the deposit. On the eastern side, deposition appears to have been enhanced in proximity to the diorite intrusions as evidenced by the close spatial relationship between distinctively higher-grade mineralization and the diorites – both on the margins and within the intrusives. The diorite bodies may have provided efficient structural (mechanical) and chemical (composition) traps enhancing reaction of auriferous fluids with shear zone wall rock.

In the fault zone, continued deformation of pelitic meta-sediments caused kinking (crenulation) of the initial foliation and development of a strong overprinting foliation. Importantly, invasion of the rocks by mineralizing hydrothermal fluid was encouraged by the higher permeability created by the fault zone, resulting in replacement of precursor minerals (pyrrhotite, Fe-Ti oxides) by fine grained aggregates of pyrite ± arsenopyrite ± native gold and deposition of the same assemblage along foliation planes. Minor thin foliation-parallel veinlets were filled by carbonate + quartz + pyrite ± sphalerite.

All ore and waste will be mined via conventional, open pit mining methods, using mining contractors. The operation is planned to utilize selective mining techniques to separate ore and waste. The mining equipment that is considered to be suitable for the TJS would include 20 tonnes to 75 tonnes back hoe excavators for ore zone mining and offhighway haul trucks with a payload capacity of between 10 to 50 tonnes.

Run of Mine (ROM) ore is delivered to the ROM feed bin by front-end loader (FEL). Ore is withdrawn from the ROM bin by a variable speed apron feeder to the primary crusher. Crushed ore reports to the crusher discharge conveyor which feeds onto the ROM bin feed conveyor.

Ore will be stored in a surge bin with 24 hours capacity. The ore will be removed by four vibrating feeders (two variable speeds, two fixed speed) and fed into a Semi Autogenous Grinding (SAG) mill. Under normal operation, one fixed speed and one variable speed unit will operate. There will be provision to bypass the surge bin with material if required. This will be loaded manually onto the SAG feed conveyor by the FEL.

Crushed ore is fed to the single stage, closed circuit SAG mill. The mill product discharges via a trommel screen to a splitter box. Oversize from the trommel reports to a bunker for removal by Bobcat or front-end loader.

The cyclone overflow reports to the conditionin ........