Mineralisation associated with the Philippine Rift Fault and Subduction System occurs as copper-gold porphyries, epithermal gold and skarn deposits associated with calcareous sediments. In Mindanao, the Diwata Ranges straddle the Philippine Rift Fault from north to south of the island.

Locally, gold mineralisation is controlled by strike-slip faults parallel to the Philippine Rift Fault or splay structures off the fault and dilationary structures which develop orthogonally to the main structures as a result of strike slip movements on structures parallel to the Philippine Rift Fault.

The PMC tenements are centrally located along an arc defining the known gold localities in Eastern Mindanao extending from Masara to Surigao with mineralisation partly controlled by intrusive bodies.

The mineralisation occurs as auriferous vein sets trending easterly in andesitic volcanics. Within the current workings to the east and west of the Oriental Fault, there are numerous steeply dipping quartz vein structures which are being mined to various depths down to 200 m below Level 1 over a maximum length of approximately 1000 m. The main vein structures, known as the Central Vein, Great Hamish Vein, Jeremy Vein and a number of others, are cut by north northwesterly trending reverse faults of limited displacement. Most of the veins have been defined by development over a strike length of approximately 1000 m in the immediate vicinity of the mine and are believed to possibly extend up to about 2000 m in strike length. The Co-O Mine works on a 3 shift, 24 hour, 26 day per month basis. The mine has its own team of airleg miners operating approximately 60 airleg machines, timbermen, bogger drivers, locomotive drivers, hoist drivers, surveyors, samplers, mappers, mine geologists, mining engineers, shift bosses, maintenance crews, electricians and other support tradesmen. All new mining data is recorded in the company’s data base on a daily and weekly basis.

The Co-O Mine is a shaft access, underground track mine, utilising battery powered locomotives and mine cars. Air-leg mining is used to extract the ore and waste is hauled to surface via the main L8 Production Shaft, two 60- degree inclined shafts; Baguio and Agsao, and through the original portals.

There are 4 winzes operating between Level 8 and Level 9 with three of these also servicing Level 10. Another winze, the 35E internal shaft, is being developed from Level 8 to service Levels 9, 10, 11 and 12. When complete the other winzes will be systematically deepened to also service Levels 11 and 12. The

E15 Shaft, a man and materials shaft, was completed in November 2018. The shaft is used for transporting people and materials underground enabling increased utilisation of the L8 Shaft for hoisting of ore.

As Ore Reserves are diminished from the upper levels, the utilisations of the Portals, Agsao and Baguio shafts for hoisting of ore will reduce partially offsetting the increased skipping expected from L8 Shaft.

Two mining methods are currently utilised at the Co-O Mine:

Shrink stope mining is predominantly used on steeply dipping veins with a minimum mining width of 1.25 metres. Mining commences from the bottom and progresses upwards and the broken ore is left in the stope to provide ground support. The volume of ore expands after blasting by about 30% and this material needs to be progressively drawn from the stope during operation. Once blasting has reached the crown pillar, the remaining 70% of ore can be drawn quickly at low cost.

Room and pillar (slot) mining is used on the low-angle veins where the ore would not naturally flow to the draw points. The broken ore needs to be scraped to the haulage Level by mechanical slushers, and pillars need to be left behind for ground support. The minimum mining width for low angle veins is 1.5 metres, hence the higher dilution is partly responsible for the overall lower than average grade achieved from the upper parts of the mine where the low angle veins are prominent. The ratio of room and pillar stopes to shrink stopes will likely decrease with depth.

The Co-O Processing Plant is a conventional gold mill, comprising a single stage jaw crusher, SAG mill and conventional CIL circuit, with a gravity gold & intense cyanide leach system. Tailings are treated and thickened before discharge to a multicelled tails storage facility.

The processing plant is powered from the regional grid, but also has its own dedicated gensets that can run the plant at full capacity if required. The majority of the power is from the area grid. The Co-O Mill performed efficiently throughout the fiscal year with mill recovery being increased to 94.3%, with head grades of 5.33 g/t.

Mill throughputs was restricted by availability of ore from the mine, resulting in low utilisation of the processing plant. Optimisation of processing plant operation and maintenance resulted to reduced cost for contract labour for mill relines and major shutdowns as these were completed by on site personnel during scheduled down time.

Low processing p ........