Navidad mineralisation is epithermal, as demonstrated by widespread open space-filling crustiform and cockade textures in the gangue minerals (carbonate, barite) and sulphide assemblages. The abundance of base metals, combined with carbonate-rich gangue, suggests that the deposit is intermediate, rather than low, sulphidation in style. Typical high sulphidation sulphides and gangue minerals are absent, but there is rare late stage kaolinite and minor hydrothermal alunite that implies late ingress of a hypogene acid fluid.

In all of the Navidad deposits the gangue minerals are principally calcite with minor barite. Silica is less important and occurs mostly as chalcedony and late amethyst. Ore minerals recognizable with a hand lens include: native silver, clots of black sulphide comprising argentite/acanthite, discrete grains of sphalerite, galena, chalcopyrite, cuprite, bornite, native copper and copper carbonates (malachite, azurite). Similar styles of mineralisation and a similar paragenesis occur in most of the deposits. However, the proportion of sulphides varies considerably. Loma de La Plata is silver-rich, but is sulphide-poor and contains very low levels of lead, zinc and copper. Various pulses of mineralisation are observed, principally at Galena Hill.

The principal metal association is Ag-Pb. Other associations include Ag-Pb-Cu and Cu-Ag and, more rarely, Ag-Zn. Occasionally there is Ag only, or Cu-Pb-Zn or simply isolated occurrences of these base metals. This suggests that deposition occurred through successive pulses of mineralisation. Gold appears to be totally absent from the system.

Mineralisation is mostly hosted in the upper latite, but important mineralisation occurs in the lower latite at Galena Hill. In a few places the underlying andesite also hosts high grade mineralisation. Deposits with mostly latite-hosted mineralisation include: Loma de La Plata, Valle Esperanza, Calcite Hill, and Galena Hill. Sedimentary rocks and volcaniclastics that overlie or are laterally equivalent to the upper latite also host significant mineralisation. Deposits where the mineralisation is dominantly hosted by these rock types include Calcite NW, Navidad Hill, Barite Hill, and Connector Zone.

High grade mineralisation mostly occurs in permeable host rocks. Examples of primary porosity include coarse volcaniclastic rocks and autobrecciated lava flows. Secondary porosity occurs as crackle brecciation of the brittle lava flows, hydrothermal eruption breccias, and tectonic breccias. At both Valle Esperanza and Loma de La Plata, the autobrecciated upper latite acted as an aquifer, sealed by overlying organic-rich sedimentary rocks (mudstones, limestones). The sediments were unconsolidated and are commonly slumped. Mixing of reduced water, derived from the organic-rich sediments, and rising metal- laden hydrothermal fluid probably triggered sulphide precipitation.

To date, the Navidad Project comprises eight individual mineral deposits in three separate mineralized trends (Navidad, Esperanza and Argenta trends). The six deposits of the Navidad Trend occur along strike over a distance of about 5.8 km and are essentially continuous. They comprise, from northwest to southeast: Calcite NW, Calcite Hill, Navidad Hill, Connector Zone, Galena Hill, and Barite Hill. The Valle Esperanza deposit occurs on the east flank of the Esperanza Trend and is found approximately 400 m south-southwest of Galena Hill. The Loma de La Plata deposit occurs in the north part of the Argenta Trend, approximately 2.2 km southwest from Calcite Hill.

The mining will be done by conventional open cut mining methods with the ore and associated non-economic material being mined on 5 m high benches and the non-economic material only tonnage being mined on 10 m high benches. The ore and non-economic material will be drilled and blasted, then loaded into 150 t trucks by a combination of backhoe loaders (17.0 m3 bucket size) and hydraulic front shovels (23.2 m3). The mine equipment fleet has been sized to accomplish the following tasks:

- Drill and blast the ore and non-economic material tonnage on a combination of 5 and 10 m benches.
- Load ore and non-economic material using either the backhoes (ore and associated noneconomic material on 5 m benches) or the hydraulic shovels (non-economic material on 10 m benches).
- Haul the ore to the primary crusher or adjacent run of mine ore stockpile.
- Haul non-economic material to its final destination, including hauling non-economic material to the 7A tailing impoundment area (but not construction of the embankment).
- Construct and maintain all roads used by the mine equipment, including berms and ditches.
- Maintain all non-economic material storage locations.
- Clean up in active mining areas.
- Other activities as needed to maintain a good working environment in the mine areas.

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A processing plant with a capacity of 15,000 tpd has been selected as the optimum size given the separate open cut configuration. The Navidad plant will be designed to process two distinct ore types in campaigns at a total annual rate of 5.475 Mt to produce two distinct and separate flotation concentrates described as a copper-silver concentrate and a lead-silver concentrate. The processing facilities are centered between the Loma de La Plata cut in the west and the Navidad Hill cuts in the east. Tailings dam location 7A has been selected and is 5 km south of the mill. The Loma de La Plata cut and parts of others will provide primarily a copper-silver ore. The Galena Hill cut and parts of others are primarily a lead-silver ore.

Ball mill discharge will be split with a portion feeding the gravity concentrator. The remaining ball mill discharge will be combined with SAG mill discharge screen undersize and gravity concentrator tails in a grinding sump and will be pumped to hydr ........