The CSH217 deposit is a large bulk tonnage low grade style of gold mineralization hosted within a ductilebrittle shear zone in Proterozoic sediments. Earlier property work and recent drilling data suggest that the gold mineralization was emplaced along the major southwesterly trending ductile-brittle shear zone. The ductile-brittle shear zone, which crosscuts the original bedding structure at about 10º, controlled the mineralization.

The shear zone is parallel to the foliation of the regional metamorphism, which is also parallel to the synclinal fold axis and deformation style typical of many greenstone and slate-belt terranes. Folding continued beyond the point of rupture, with the strain taken up in the developing shear zone. The quartzsulphide veinlets are boudinaged within the foliation and were clearly deposited early in the deformational history and are perhaps related to basin dewatering during regional folding, typical of “Slate Belt” gold districts.

The host rocks to the gold mineralization on the CSH217 property are mainly carbonaceous phyllite, schist, and slate within the lower members of the Bilute Formation.

The gold mineralization is composed of thin (1 to 10 mm) sulphide and quartz-sulphide seams/veinlets, stringers, and boudinaged lenses, which are concordant with the bedding and foliation and trend along the shear zone. Much quartz vein material has been logged in the drill holes associated with the higher grade gold sections. Most of these “veins” are probably derived from remobilization of siliceous exhalative layers in the hydrothermal process, perhaps related to basin dewatering during regional deformation and metamorphism. The higher-grade gold zones are parallel or sub-parallel the regional metamorphic foliation texture. In most cross-sections connecting of the higher-grade intervals shows relatively consistent dip angles of the mineralization zones ranging from 82-85o in the Northeast Zone, and 87-89o and dipping opposite in the Southwest Zone.

The principal type of mineralization is native gold occurring directly with the sulphides in the seams and in association with the quartz “vein” material. Mineralogical work by SGS Lakefield in Canada on composite weathered and fresh mineralization samples found 77% of gold was free in the sulphide composite and 100% of the gold was free in the weathered sample (SGS Lakefield Research Limited, January 22, 2003). Pyrite and phyrrotite are the most abundant sulphides with their total content generally ranging between 1 and 2 percent. The mineragraphic investigations by Jinshan identified the “pyrite” as melnikovite pyrite or zwischen-product, a disequilibrium mixture of pyrite, iron oxides, secondary magnetite commonly intergrown with marcasite that can be distinctively aligned in lamellar fashion. This texture was shown to develop along the 0001 cleavage of adjacent pyrrhotite.

The quartz vein and sulphide seam contacts are all knife sharp with no alteration selvage in the host rocks. The hydrothermal alterations of the host rocks are rather weak, with only chlorite and silica alterations noticed in the drill logs. The host sediments are moderately to strongly metamorphosed to phyllite and schist with abundant sericite. Andalusite crystals up to 3 cm in length are prominently developed in the schists. The andalusite schist interface is parallel to original bedding. Development of andalusite is likely to be related to original alumina content and regional metamorphism. In the Northeast Zone a major andalusite schist unit with intercalated slate-phyllite layers occurs in the footwall side, and about onefourth of the gold mineralization hosted in this unit. In the Southwest Zone, about one-third of the gold mineralization is within the andalusite schist, which occurs in the hangingwall side only.

Surface work and diamond drilling has tested the mineralized zone and stratigraphy over a continuous strike length of 4.8 kilometers trending southwesterly across the CSH217 property with drilling to a maximum vertical depth of 260 metres. The mineralized sections are variable in width achieving a maximum width of 150 metres in the eastern part of the property.

The open pit Mining takes place on 6 m benches using percussion drills, excavators, wheel loaders, and offroad trucks of the 40 t class that are currently being increased to 100 t class trucks.

The Northeast pit will be mined in 4 phases as shown in the bench plan and section below. Phase 1 through 3 are radial expansions of the pit. Phase 4 willexpand the pit to the northwest and to depth. A single spiral ramp will be used to access the pit bottom linking to the Phase 3 ramp on the south side of the pit. The Southwest Pit will be mined in 1 phase.

Mining operations will be completed in 2023 and leaching will continue until 2027.

Jinshan Gold Mines Inc., now China Gold International Resources Corp. Ltd. completed a 20,000 t/d gold recovery facility, heap leaching, carbon-in-column (CIC) gold absorption, carbon stripping, carbon regeneration and acid washing, bullion refining, and reagent systems. A 30,000 t/d crushing facility was commissioned in September 2009 and has been in operations since that time.

The main processes applied to the heap leaching of the ore at the CSH mine are consistent with typical heap leach operations and consist of:

• Mining ore and waste
• 3 stages of crushing to 80%, -9mm
• Ore placement on CN leach pad
• Recovery of pregnant CN solution
• Carbon–in-column (CIC) Au recovery from solution
• Stripping and electrowinning
• Gold smelting to recover doré bar

The proposed expansion incorporates essentially a duplicate processing facility to the existing 30,000 t/d plant. Crushed ore from each crushing plant will be delivered independently to the heap leach pad. The current plans are also to operate independent pregnant solution recovery facilities; carbon columns, strip circuit and electrowinning cells. Sludge from the expansion electrowinning cells will be processed in the same refinery facilities by managing the operating schedule.

Primary Crushing:

The existing primary crushing facilities consist of 2 operating jaw crushers. Due to the size and slabby nature of the blasted ore the mine trucks dump the ore across a fixed grizzly. A rock breaker mounted on a tracked excavator is used to maneuver the ore through the grizzly breaking the ore as required. Ore is reclaimed from the truck dump pocket by an apron feeder that discharges the ore to a vibrating grizzly feeder. The undersize from the vibrating grizzly bypasses the primary jaw crusher while the grizzly oversize drops through the jaw crushers. These products are combined and delivered to the secondary cone crushers.

The existing primary crusher circuit is very complex and requires multiple equipment components, multiple transfer points and multiple crushers to achieve the design capacity. For the increased throughput the flowsheet has been changed to include a primary gyratory crusher and to add a stockpile storage capacity between the primary crusher and secondary crusher circuits.

With both crushing plants operating independently the jaw crushers will still be required to achieve production in the existing circuit.

Secondary and Tertiary Crushing:

The existing plant is designed with 2 open circuit Metso HP800 secondary standard cone crushers and 4 closed circuit Metso HP800 tertiary cone crushers. The operation of the cone crushers has not been a problem in the existing operations so to double the capacity the expansion will use the same number and size for both the secondary and tertiary crushers.

In the existing plant the Metso vibrating banana screens were a significant problem and eventually the operations and maintenance team sourced replacement screens from within China. The main issues were with the premature failure of the side plates. For the expansion it is understood that the number of screens will be increased and instead of banana screens, conventional screens will be used.

The conceptual design concepts also includes for the installation of fewer transfer conveyors and for increasing the belt width. With the current belt speed and multiple transfers the maintenance costs are very high.

CIC Tanks

The original design of the CIC circuits included 2 trains of 6, 3.8mF x 2.9m CIC tanks. When the existing 3 stage crushing circuit was added for the fresh ore a single train of 5, 7.5mF x 8m CIC tanks was added. The larger tanks have not provided the same kind of performance as the smaller original tanks in terms gold loading to feed strip or Au solution losses that return to the heap. For the expansion project the intention is to install 4 parallel trains of 6 CIC columns to match the originals.

Upon review of the existing facilities it was determined that there is insufficient flow to the large carbon columns to operate them with sufficient carbon bed expansion to achieve typical carbon column efficiencies.

The proposed expansion with 4 parallel trains of smaller carbon columns followed by dedicated stripping and electrowinning is not considered cost effective for capital or operating costs and it is recommended that another look at equipment sizing (carbon columns and strip vessels) and comparing the proposed expansion circuit to industry practice should be considered.

Electrowinning Cells

The initial strip and electrowinning circuit was designed and supplied by Summit Valley (SVL) from Salt Lake City. Apparently there were a number of problems with solutions flashing in the atmospheric electrowinning cells that were supplied by SVL. CSH successfully replaced the atmospheric electrowinning cells with pressurized electrowinning cells to alleviate this problem. In reviewing the performance of the stripping and electrowinning cicuit indications were that the stripping cycle was taking between 15 and 16 hours to complete. Typically the strip cycle should be between 8 and 10 hours. The primary influence in the efficient operation of the strip cycle is the single pass efficiency of the electrowinning cell. A longer cycle increases the operating costs of the circuit. There may be potential cost benefits to reviewing the equipment selection for the expansion flowsheet.