The Point Rousse Complex is host to orogenic style gold mineralization. Mineralization comprises both vein-hosted and altered-wall rock or replacement styles of mineralization and both exhibit features common to orogenic gold deposits. The mineralization is typically structurally controlled and developed within subsidiary deformation zones, such as the Scrape Trust Fault, to major regional structures, like the Baie Verte – Brompton Line fault. Gold mineralization is intimately associated with disseminated and massive pyrite within the host rock indicating that iron rich rocks are an important precursor to mineralization. Alteration within mafic volcanic and gabbroic rocks can be is characterized by albitization and carbonitization. Iron and titanium rich lithologies associated with the Scrape Thrust are typical host rocks.

The Point Rousse gold mineralization exhibits relatively narrow, but distinctive alteration haloes dominated by Fe-carbonate, albite, sericite, chlorite and leucoxene (Plate 9). The ore mineralogy is relatively simple and is generally comprised of non-refractory gold either as free gold or as coatings on, or along fractures/grain boundaries in pyrite. Silver and base metals can be present in minor amounts and the deposits typically exhibit only trace arsenic.

The Project covers three prospective gold trends: the Scrape Trend, the Goldenville Trend and the Deer Cove Trend. These trends have approximately 20 km of cumulative strike length and include three deposits and numerous prospects and showings all located within 8 km of the Pine Cove Mine and Mill.

The Scrape Trend consists of a prospective belt of rocks approximately 7 km long and 1 km wide.

Mineralization within the Scrape Trend is typical of orogenic greenstone-hosted gold. The fault, where observed is not mineralized, but secondary structures adjacent to the fault zone can host gold, such as the deformation zone which hosts the Pine Cove Deposit as well as the structures hosting the Stog’er Tight Deposit.

The Stog’er Tight area is host to several gold prospects including the; Stog’er Tight Deposit and its East and West extensions, the Gabbro, Gabbro East, Gabbro West, South and Cliff zones, The geological setting of the Stog’er Tight area is characterized by volcaniclastic, sedimentary and intrusive rocks, which form part of the cover sequence of Snooks Arm Group.

The gold within the Stog’er Tight Deposit occurs as fine-grained (<.05 mm) micro veinlets and disseminated blebs within the coarse pyrite aggregates. Visible gold was observed as rare very delicate flakes localized within weathered-out pyrite cubes and in narrow quartz veins. Generally, higher grades are associated with coarse mottled pyrite.

Development of the Stog’er Tight mine will include two adjacent open pits: The West and East pits. Approximately 1,100,000 tonnes of material will be mined while developing the West pit, followed by 533,000 tonnes of material while expanding the East pit.

Once west pit is exhausted, waste rock from East pit would be placed into it to about 6 metres below water level. The exhausted east pit will also expand the existing Fox Pond to have larger pond footprint.

Equipment at Stog’er Tight will be operated by the same contractors as the Pine Cove site: Bailey and NL Hardrok.

The mining operation at Stog’er Tight will stockpile the ore on the Stog’er Tight property initially. A separate activity will transport ore from Stog’er Tight to Pine Cove mill for processing. This material will be stockpiled in the same location as the current Pine Cove ore.

The Pine Cove Mill operates as a grind/flotation circuit followed by leaching. Comminution is via a two-stage crushing plant followed by a 10 ft by 14 ft primary ball mill, which processes an average of 1,340 tonnes per day of ore. Cyclone overflow feeds the flotation circuit, with 3 column cells for roughing, 1 scavenger/staged reactor cell, and one cleaner cell. The concentrator has a flotation circuit which produces a gold-pyrite concentrate that advances to the leach circuit. Mass concentration is typically 2-4%, with a recovery of 92-93%. Flotation concentrate is thickened in a 4.5 m diameter thickener and reground in a 5.5 ft diameter ball mill down to a P80 of 20 microns. Leaching is conducted in a series of four 70 m3, mechanically-agitated leach tanks. Two drum filters and a Merrill Crowe circuit are used for gold recovery from the pregnant solution.

The mill process at the Pine Cove site consists of 6 major systems: crushing, grinding, flotation, leaching, drum filtration, and Merrill Crowe. Ore is fed to the crushing plant via front end loader, where it first enters a jaw crusher. After crushing, a conveyor takes the ore to a screen deck, where the fine material is separated. Oversize ore is be recirculated through a cone crusher until it reaches the desired top size of 0.5 inches.

Ore from the crushed stockpile is then fed to the primary ball mill via conveyor belt, and typically averages 1.5 to 2.0 g/t Au. The ball mill is charged with 3 inch and 3.5 inch balls, and grinds material to a K80 of 150 micron. Material from the ball mill is pumped through a cyclone, where liberated material is fed into the flotation circuit via an overflow. Any coarse material is returned to the ball mill.

The flotation circuit at Pine Cove utilizes 3 rougher columns, 1 cleaner column, and 1 scavenger cell. PAX and Maxgold are introduced to the circuit as collectors, and MIBC as a frothing agent. Overflow material is sent to a thickener tank, typically at concentrations of 75-100 g/t Au. Tailings from the flotation circuit are pumped to the tailings pond via the final tailings pump. Flocculent is added to the thickener tank to increase the density of the slurry from 1300 kg/m3 to 1600 kg/m3.

The underflow from the thickener tank is pumped to a regrind mill, to further liberate the gold particles in preparation for the leaching process. The regrind mill is filled with half inch balls, and grinds material to a K80 of less than 20 micron. The discharge of the regrind mill is fed to the leaching circuit, which consists of 4 large tanks, where cyanide solution, lime, and lead nitrate are added. Leaching takes 36 hours on average, and yields upwards of 97% recovery of gold. Solution from the leach circuit is pumped to a series of rotary drum filters, which separate the solution containing the high grade gold from the solid leached tailings. The Leach Plant includes an Inco SO2/Air type cyanide detoxification circuit which treats the slurry prior to its discharge to the tailings management facility.

From the drums the pregnant solution is sent to a series of holding tanks, before eventually entering the Merrill Crowe tower. Zinc dust is added to the tower to precipitate the gold, which is then collected in a filter press. Tailings from the press are sent to the final tailings. Once a week, the press is opened to remove the solid gold so that it can be refined into a Dore bar.