The Jiama deposit is a structurally controlled stratiform skarn-type copper-polymetallic system. The majority of high grade mineralisation is associated with shear zone contacts between the Duodigou and Linbuzong formations and shear related folding. The zone of mineralisation within fault hosted skarn alteration measures kilometres in both strike and dip and remains open at depth to the northeast.

Mineralisation is also associated with granite porphyry dykes intruding the ‘Duodigou Marble’ and observed within the overlying hornfels of the Linbuzong Formation.

Although both deposit types are of lower grade than that of the skarn, the hornfels style of mineralisation may potentially be of further economic value in the future.

Three types of copper-polymetallic mineralisation are recognised in the project area, these include skarn, hornfels and porphyry hosted deposits.

High grade copper-polymetallic mineralisation is associated with skarn type alteration within shear zone contacts between the Duodigou and Linbuzong formations. This stratiform fault zone is tabular to lenticular in shape, has a variable dip, strikes west-northwest and hosts the primary lode.

The mineralised body itself has a 60° near surface dip angle which flattens to an average dip of 10° with depth. Thicknesses vary between 2 m to 240 m, averaging 33 m, its strike length is approximately 2,400 m and its length down dip ranges between 150 to 1,900 m. It is primarily divided into two zones of mineralisation; the Niumatang Zone and the Jiama Zone. A number of smaller, lenticular shaped skarn-type mineralised bodies have also been identified below and to the southeast of the primary body, however they are generally discontinuous and of limited strike (<200 m) and thickness.

Copper mineralisation shares associations with chalcopyrite, bornite and chalcocite and is hosted by either thin veinlets, as disseminated sulphide crystals or as massive sulphide zones.

Hornfels hosted mineralisation is of lower grade than that of the skarn type deposits and occurs predominantly as disseminated sulphides. Mineralisation is fine grained and consists of copper in association with chalcopyrite, bornite and molybdenum. No massive sulphide zones or veining has been recognised within the texturally massive and highly fractures rock mass. Earlier observations of copper associated with pyrite and pyrrhotite coating fracture planes has been attributed to secondary enrichment.

The mineralised body shows no preferential orientation, it is shallow, tabular shaped and approximately 1,200 m in length, 1,000 m wide and generally 10 to 50 m thick, although a maximum thickness of 826 m was intercepted in drillhole ZK3216. It pinches out in the westsouthwest and in general is thinner towards both the west-northwest and east-southeast.

Mineralisation in porphyritic granodiorite and monzogranite is characterised by molybdenum with lesser amounts of chalcopyrite and bornite. Sulphides are medium to coarse grained and confined to a thin horizontal pipe shaped body with a maximum known thickness of 476 m. The porphyritic host lies beneath the Duodigou Formation and appears intruded into the sheared contact between the two basement units.

Conventional mining methods have been proposed for the open pit and underground operations.

China Gold currently mine the Jiama deposit as an open pit and underground mine and intend to continue and expand both operations. The Jiama underground workings are currently accessed via declines and adits, with future plans to include a conveyor drive for ore haulage, vertical shaft for waste haulage and decline expansion for improved access. The current mining activity is limited to hand-held air leg mining for both development and stoping.

Conventional selective mining methods using truck and shovel are planned to be employed to extract the mineralised material from the proposed open pits. Mining is planned to occur on shallow flitches, typically 3m to 4m high, which will enable better grade control of the mineralised zones.

The open pits are the Jiaoyan and South Pit. The Jiaoyan pit will be mined in two stages and South pit four stages.

Mining of Phase II will commence in two open pits and an extensive underground mine including; Jiaoyan Pit, South Pit and the underground mine respectively. The open pits and underground expansion will be developed simultaneously. The Open pits will be separated from the underground operation by a crown pillar that will be maintained between the base of South Pit and the upper Underground Mine. Stope voids will be progressively backfilled beneath the base of the pit floor to reduce the potential for open pit and underground mine interaction. The two underground mining methods considered in this area are cut & fill mining and sub-level caving. The area under the pit is not planned to be designed in the initial 10 years of operation. The pit should be finished by this time which would make sub-level caving a possible option here.

Huatailong No. 1 Plant:

China Gold will operate the two site processing plants and prov de comprehensive technical support across all facets of the operation.

The 6,500 tpd Huatailong processing plant commenced operation in 2010, and was designed to treat both Copper-Molybdenum and Copper Molybdenum-Lead-Zinc ores. For treatment of the copper-molybdenum ores, only the flotation cells installed to separate lead from copper concentrates are not in operation, and if the Mo content is too low to be economic, the coppermolybdenum separation flotation circuit is shutdown.

Currently, Copper-Molybdenum ore from the Tongquianshan and Niumatang open cut mines is being treated. The molybdenum content of these ores is too low to be economic and only copper concentrate containing gold and silver credits is being produced, through a conventional beneficiation circuit suitable for treatment of the skarn ore.

For treatment of Copper-Molybdenum-Lead-Zinc ore, Run-of-Mine is reduced in three-stages of crushing, then delivered to a fine ore storage bin. The bin discharges to parallel Primary Ball Grinding Mills operating in closed circuit with hydro-cyclone classifiers.

The grinding circuit product at p70 of 74 microns reports to a bulk flotation rougher scavenger circuit, followed by three cleaning stages. The rougher-scavenger tailings feed a zinc flotation circuit to produce a zinc concentrate and final tailings which is dewatered in a press filter press and stockpiled.

The copper-molybdenum-lead concentrate is refloated to separate the lead, and the coppermolybdenum tail is reground in a ball mill closed with hydrocyclones, then refloated to separate molybdenum from the copper. In Column Cells, all concentrates are thickened and filtered in ceramic disc filters and delivered to stockpiles.

Currently, Copper-Molybdenum ore from the Tongquianshan and Niumatang open cut mines is being treated; the molybdenum content of these ores is too low to be economic and only copper concentrate containing gold and silver credits is being produced. The copper-molybenum and copper-lead-zinc circuits are not operating for this ore.

It should be noted that an existing 600 tpd pilot plant, described in 0 below, has enough capacity to treat the small amount of Copper Lead-Zinc ore shown in the current mine production schedule.

The Huatailong plant is a conventional beneficiation concentrator suitable for treatment of the Jiama skarn ore; it is well instrumented, with automatic control of key circuits. The on-site laboratory is well equipped to provide the assays of geological, mining and process plant shift samples.

The fine regrind in the copper molybdenum circuit coupled with the high altitude location results in high moisture content ~ 13% in the copper concentrate, through the ceramic disc filter. A filter press with air blow facility would be necessary to improve this.

Pilot Plant:

The process plant, rated at 600 tpd, was constructed some years ago using equipment from an earlier processing plant and used for pilot plant testwork. This plant was modified in 2011.

The copper-lead-zinc ore represents ~ 3% of the total ore resource and requires a different processing route to produce saleable copper, lead and zinc concentrates.

This plant could be used to treat the copper lead-zinc ores which are shown in the mine production schedule to be mined at a rate of 200,000 tpa. The flowchart and equipment are amenable to the production of saleable concentrates, comprising conventional three stage crushing, primary ball mill grinding delivered to flotation circuits for sequential copper, lead and zinc separation.

The parallel ball mills are closed with spiral classifiers, the overflow reports to flotation and the sands return to the mill. The flotation feed size is p70 of 74 microns.

Copper, lead and zinc concentrates are thickened and then dewatered in ceramic disc filters.

Huatailong No.2 New Mineral Processing Plant:

Plans are in place for the design and construction of a second mineral processing plant to treat the skarn and hornfels hosted copper-molybdenum ores. The nameplate capacity will be 43,500 tpd and the design will provide for separate or blended treatment.

The process flowchart was developed from the results of testwork carried out by the General Research Institute Beijing, and operational experience with current plant.

The plant will be conventional but will differ from the existing plant in that the front end comminution will comprise a Primary Gyratory crusher to prepare feed for parallel SAG Mill Ball Mill circuits. The SAG Mills circuit will incorporate cone crushers to reduce any critical size pebbles which may build up.

The Primary Ball mills are closed with Hydrocyclones, and produce a grind size of p70 = 74 microns for bulk copper-molybdenum flotation.

The two ore types have different characteristics in terms of mineral assemblage, head grades, and hardness and the parallel circuits will provide flexibility for separate or blended treatment, and flexibility in maintenance scheduling.

The flotation circuitry and reagent regime is conventional comprising bulk flotation and cleaning of the copper and molybdenum, regrinding of the cleaner concentrate to p90 = 45 microns, followed selective flotation of the molybdenum, from the copper using column flotation cells to achieve the best molybdenum concentrate grades and recovery.

The copper concentrate will be thickened and filtered in a ceramic disc; the molybdenum concentrate will be dewatered in a pressure filter, and dried in a rotary dryer. Flotation tailings will be dewatered in filter presses and delivered to a tailing storage facility. Instrumentation and Auto-control systems will be installed in key circuits to ensure stable and optimum operation.