The mineral deposits at San Bartolomé are alluvial and colluvial, surficial accumulations of silver- and tinbearing unconsolidated material, which were derived from erosion of Cerro Rico, a prominent +4,700 meter elevation mountain, and accumulated down-slope filling depressions, gullies and low-gradient areas. Locally they are called “pallacos” which also includes reworked Sn-bearing gravel deposits called “sucus” and “troceras”. Mineral deposits at Tatasi-Portugalete are man-made, dumps adjacent to underground mine portals of ancient and current mines.

San Bartolomé
The mineral deposits at Cerro Rico are the source of the San Bartolomé pallacos and are high sulfidation epithermal in character, composed of veins, stockworks, hydrothermal breccias and irregular bodies, hosted in a very altered resurgent dome of dacitic- to rhyodacitic-composition porphyritic intrusion emplaced in Middle Miocene time (approx. 14 mya). The pallacos were derived from the erosion of the Cerro Rico hydrothermal ore deposit and were emplaced around the mountain crest by recent geologic processes. These deposits consist of an unsorted mixture of cobbles and boulders in a sandy clay matrix, accumulated down slope by colluvial and alluvial processes, filling depressions, gullies and low-gradient areas. They cover an area of over 5 km2 in size. Geologically, the true thicknesses of the pallacos range from <1 m to nearly 75 m. The deposits have been grouped into three areas named Antuco (within the greater Diablo area), Huacajchi and Santa Rita. The primary rock source of silver content for pallacos is the mineralized, silicified wall rock adjacent to the veins and disseminations of Cerro Rico. Rock clasts are highly oxidized, variably silicified and mineralized with disseminated native silver, sulfosalts of silver, argentite, jarosite and psilomelane (Mn oxide). Pallacos grade from predominantly coarse, broken rock on the upper slopes into a mixture of coarse rock fragments in a sandy clay matrix down slope to more finegrained material further downslope. The surface area of the current mineral resources is approximately 337 hectares.

Tatasi-Portugalete Dumps
The in situ source of the Tatasi-Portugalete dumps is a high sulfidation, epithermal polymetallic deposits (Ag-Zn-Pb) related to volcanic domes and dikes intruded into a shale and quartz sandstone sequence, together with pyroclastic and lava flows. This volcanic-sedimentary sequence developed a radial fracture system, with hydrothermal alteration, containing veins, veinlets, stockworks and disseminations. The primary deposit is zoned vertically, with silver-rich upper levels grading into zinc-rich deeper levels. Years of operation generated dumps with mineral concentrations that can now be considered economic. Historic and current miners use flotation plants located in the region (which are designed for sulfide material). Metallurgically, these oxidized dumps are amenable to the NaCN leaching process, used for silver recovery at the San Bartolomé facility. Tatasi-Portulagete is located approximately 350 km south of the San Bartolomé operations and the surface area which covers the Tatasi-Portugalete dumps is approximately 320 hectares.

FDF
The Fines Deposit Facility or FDF is an impoundment of fine (-2.4mm, 8 mesh#) material that has been screened out of Pallacos mineral sources at the plant crusher station and then stored since the operation started. The material in the FDF is now considered to be a potential economic resource and has been explored primarily through barge-supported sonic drilling. Extensive drilling has been implemented to characterize the geochemical and geotechnical characteristics of the FDF. Deposition of fines to the FDF is ongoing as of the effective date of this report, and it is expected that additional drilling may commence in other areas of the FDF to improve confidence in the mineral resources or to obtain additional samples for testing.

Ore is mined from the Company’s permitted mineral reserve areas:
- The San Bartolomé mine (“pallacos”).
- Dump areas at Tatasi-Portugalete and El Asiento.

The project utilizes conventional surface mining methods to extract colluvial, and alluvial materials mine dumps, oxide and sulfide tailings and other materials named pallacos and sucus and troceras (collectively, the “pallacos”), which have been identified in the Huacajchi, Santa Rita, Diablo (Norte and Sureste areas – now referred to as Antuco) - Pallacos Areas.

An exclusive mineral purchase contract is in place between Manquiri and RALP Compañía Minera, S.R.L., a private, Bolivian mining company (“RALP”). The contractual rights held by Manquiri are for processing of 108,000 tonnes of silver- and gold-bearing material being mined by RALP.

The current mine plan is designed with 5 m benches and 2 m berms. Additional 5 m wide safety berms were included in the design when the slope height exceeds 25 m.

Dump areas at Tatasi-Portugalete and El Asiento will be fully reclaimed in 2 m slices in a top-down sequence. If internal operational slopes are required, the angle of repose of 37° will be considered.

The mining strategy adopted by Manquiri is a mixed between an owner operation and contracted:
• In the pallacos areas Manquiri operates the loading with owned excavators of 2.4 / 2.6 m3 and auxiliary operations (bulldozers and motor graders) and the hauling of the ore to the plant is contracted with 24 tonnes conventional trucks operated by local “cooperativas”. The re-handling at the plant area is owner operated with front-end-loaders of 3.4 / 4.2 m3 and 24 tonnes trucks.
• All mining activities at Cachi Laguna are contracted, except for the drilling.
• At the mining dumps at Tatasi-Portugalete and El Asiento, the mining activities are fully contracted.

- subscription is required.

The plant was designed to operate 24 hours a day, 365 days a year with 92% availability. At full, design capacity, the plant can process up to 4,800 tonnes/day (1.5-1.6 million tonnes per year). In addition to silver, smaller quantities of gold are also recovered from the leaching of the oxidized, silver-rich ores. Transitional and/or sulfidic material does not exist in the pallaco mineral resources but has been identified in some of the historical purchased materials.

The silver is leached using a sodium cyanide (NaCN) solution and the plant is designed to recover approximately 78.0% of the silver from the ore, although metallurgical recovery will vary with different ore types. Thus, the final valuable product from the plant is 99.95% silver, but is called doré.

Cyclone overflow slurry produced by the grinding circuit is directed over a trash screen and then pumped to the cyanide leach circuit.

Cyanide Leach and Counter Current Decantation
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