The mineralization at ESM has been classified as sedimentary exhalative (Sedex) in origin. The composition of the mineralization is unique, composed of primarily massive sphalerite and only minor galena and pyrite. Massive and semi-massive sphalerite-bearing deposits occur in siliceous dolomitic and evaporite-bearing marbles of the Upper Marble Formation of the Balmat-Edwards marble belt. These zinc-sulphide deposits lie in the core of the Sylvia Lake Syncline, a major poly- deformed fold lying between Balmat and Edwards. Zinc mineralization tends to follow evaporate deposition in the stratigraphic sequence. The region has experienced multiple metamorphic and intrusive events and large-scale ductile structures are common.

The property contains 14 known zones of sphalerite mineralization. Three clusters have been defined consisting of three to five deposits each. Geometry of mineralization varies, ranging from tabular to podiform and shallow to steeply dipping. Areas defined to date contain tonnages ranging from roughly 0.5 Mt to over 10 Mt. Typical thickness ranges from 2 ft to 12 ft thick. Mineralization tends to be very continuous along strike, ranging from 50 ft to 800 ft Plunge-lengths may exceed 6,000 ft.

There are two mineralization styles recognized in the district. Stratiform high-grade massive sphalerite is interpreted as primary mineralization contemporaneous with deposition of the Upper Marbles. Discordant breccia-like “durchbewegung” textured sphalerite is considered to be secondary and remobilized along brittle-ductile shear zones. Mine geologists conceptualize a primary- secondary relationship, where the stratiform mineralization is the primary source and the crosscutting zone, locally called “durch”, is the secondary. The structural model suggests that secondary resources are formed from sphalerite remobilized during metamorphism. The sphalerite migrates along structural conduits laterally from their source. The remobilized zones share similar trace element geochemical signatures with the interpreted primary zones. The durch often contains significant quantities of occluded wall rock material which imparts a distinctive texture. Previous workers have experienced exploration success using the structural model, defining four new zones in the 1990’s.

The zinc-lead ratio is approximately 35:1 in most mineralized areas. ESM has slightly higher-than- average grade for a sediment-hosted lead-zinc deposit. Typical grades of sediment-hosted lead-zinc deposits may average 7.9% Pb and Zn combined. The average grade was 8.6% Zn, while the average for the greater Balmat-Edwards zinc district is even higher at 9.4% Zn. Galena is characteristic of primary stratiform mineralization with the secondary deposits exhibiting very minor amounts. Mine geologists have hypothesized that intense metamorphism may have concentrated the sphalerite, perhaps fractionating zinc sulphide (sphalerite) from lead and silver sulphides (galena) and remobilizing them to different locations leading to the high zinc grades observed at ESM. Galena and pyrite are occasionally observed within an aureole adjacent to some resources concentrated as fine veinlets or disseminations on the order of a few inches to feet particularly within the more brittle lithologies.

The mine utilizes a combination of selective longhole stoping, modified or stepped room and pillar and mechanized Cut and Fill as mining methods, based on the geometry and the grade of the mineralized zones:
- Longhole stoping (“LH”) for mining blocks dipping steeper than 45°, which represents about 50% of the mine plan tonnage. This is the preferred mining method from a productivity and operating cost perspective;
- Mechanized Cut and Fill (“C&F”), for mining blocks with dips of less than 45° and zones not amenable to LH stoping, is more selective and represents about 7% of the mine plan tonnage;
- Modified or Stepped Room and Pillar (“RP”), for mining blocks with dips of less than 45° and grades, do not warrant the application of a fill to permit multiple panel extraction, representing 11% of the mine plan tonnage.

The mine plan tons at the ESM deposit will be extracted using a combination of longitudinal retreat stoping (LGS), Cut and Fill (C&F), Panel Mining – Primary and Secondary (PAP & PAS), and development drifting underground mining methods with rock backfill. Longhole backstopes (BCK) are also used in the design where applicable. The proposed combined underground and open pit mine plan is expected to reach an initial target production rate of 1,200 t/d for 2021 and ramp up to 1,800 t/d in 2022. Open pit mining will be completed in Year three (2024). The overall mine life will be seven years.

Underground
The ESM deposit will be accessed from surface via the No. 4 shaft, and all mineralized material and some waste rock will be hoisted out of the mine via that shaft. In addition to the existing development and raises, new lateral development and ramping will be required to access mineralized zones. To supplement the ventilation provided by the raises, as the ramps are being driven, shorter internal ventilation drop raises will ensure air delivery to the active development face.

Ramps are driven at a 15 ft x 15 ft square profile to accommodate fully loaded 40 t haul trucks and 48” round vent ducting. Cross-cuts and sub-level development are driven at a 13 ft x 13 ft square profile to accommodate remote LHD entry.

Development headings are driven with electro-hydraulic single and dual boom jumbos. Twelve-foot steel is planned in C&F zones where single boom jumbos are required to make quick turns to follow the mineralization. The advance per round is assumed to be 10 ft for 12 ft steel. One jumbo has the capacity to drill between two and three rounds per shift, however, cycle productivities are limited to 1.5 rounds per day per jumbo in the schedule. Production drilling for the longhole stopes is performed by longhole drills. Blastholes with a 3.5” diameter are drilled in a fan pattern from the overcut to the undercut.

Development rounds are charged by a bulk explosives tractor. Lifter holes are loaded with packaged emulsion. Blasting is initiated by non-electric (NONEL) detonators. For longhole production blasting, bulk emulsion is used together with NONEL detonators and 60 g boosters.

After mucking and scaling is complete, ground support is installed by a mechanized bolter or manually by experienced operators using jacklegs and stopers. Typical ground support in access development is planned to consist of 5 ft and 6 ft split-set bolts in the back and in the walls at a spacing of 4 ft x 4 ft. Welded wire mesh will be installed in all ground conditions. In intersections, 22 ft cable bolts will be installed on a 6 ft x 6 ft pattern for deep ground support. Cable bolts will be installed into the hangingwall prior to longhole stope firing with an average pattern of six bolts per ring and 10 feet between rings.

Blasted material from development headings is mucked with either 4.0 yd3 (7 t) or 6.0 yd3 (10 t) LHD directly to a haul truck, remuck bay, or material-pass. Broken material from longhole stopes is mucked by remote control LHD.

A fleet of 40 t haul trucks haul mineralized material from the active production areas and internal material-passes to the shaft loading station. The same haul trucks are used for waste material transport to areas requiring waste backfill. Haulage profiles for each of the mineralization zones were generated to calculate equipment hours for the fleet.

Only the C&F mining method requires the placement of waste rock as backfill. No cemented backfill is currently planned at ESM. Underground development waste may be placed as backfill in stope access ramps and remote stopes to minimize waste haulage to surface.

Open pit
Conceptual pits were designed based on the selected pit optimization shell as described above. Design criteria were:
• Double lane ramps = 32 ft wide, 10% grade.
• Single lane 18 ft wide up to 12% grade.
• Pit slopes as per geotechnical guidelines except FW of Hoist House as described below.
• Overburden nominally 2:1 slope with a 15 ft setback along contact.
• Road fills 2:1.
• Bench access maintained on one side of ramp (pits and dumps). i.e., benches not pinched off on both sides.

It is proposed to mine the open pits using conventional truck and excavator mining methods. A mining contractor operation is presumed. Overburden is assumed to not require blasting. All bedrock will require drill and blast operations. Benches shall be 20 ft high with safety berms every second bench (i.e., double benched to 40’ spacing). The excavator would typically sit on a temporary platform part way up the muck pile and load trucks sitting on the bench level a few feet below. Due to the small pit sizes, none of the pits are phased and mining will be by a simple descending, full bench, top-down sequence.

Standard, midsized top hammer or down the hole hammer drill rigs are envisioned. The rigs would be equipped with blasthole sample equipment to collect samples for grade control. Explosives would be straight ANFO, emulsion, or ANFO blends. Drilling and explosive supply including loading and shooting, are assumed to be provided by contractors.

Two hydraulic excavators equipped with 5.9 cubic yards (yards3 or 4.5 m3) buckets (similar to CAT 374 machines) would be required to mine waste and mineralized material. They would load into a fleet of 40 st road trucks (such as Mercedes Actros) or articulated dump trucks (ex. CAT 740 ADT). Waste hauls are short (approximately 0.65 mi) while hauls for mineralization are longer (approximately 1.5 mi). Overall, annual excavator productivity is estimated at approximately 320 tons per hour (t/h) and trucks at 100 t/h in mineralization and 190 t/h in waste. Excavators and trucks have been estimated to operate 2,100 h/yr. 5 trucks should be adequate to meet production. One excavator with 2 trucks could stay permanently in waste. The second shovel with 3 trucks could do 3 shifts/week in mineralization and 7 shifts in waste.

Mining efforts throughout 2021 and the fourth quarter of 2021 focused on the New Fold, Mud Pond, Mahler, and N2D zones. Development continued to focus on the New Fold and Mahler ramp systems to access high grade material over the life of mine. It is anticipated that development of these areas will open up new mining horizons which are expected to be accessed in the second half of 2022.

Work on projects included replacement of the counterweight rail in # 4 shaft and the addition to the underground mobile fleet of a two-boom jumbo, a 40 ton haul truck, a lift truck and a diamond drill.

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Mineralized material mined in the ESM deposits is processed at the existing ESM concentrator that was commissioned in 1970 and last shut down in 2008. The concentrator was refurbished in late 2017 and began processing mineralization in 2018. The concentrator flowsheet includes crushing, grinding, sequential lead and zinc flotation circuits, concentrate dewatering circuits, and loadout facilities.

The design capacity of the concentrator is 5,000 t/d. Through-out the history of the Balmat operation (now ESM), the capacity of the concentrator has exceeded that of the mines’ capacity. The operating strategy is to operate the concentrator at its rated hourly throughput of 200 t/h to 220 t/h, but for only as many hours as necessary to suit mine production. It currently is processing between 6,500 to 7,000 tons per week operating on a schedule of one shift per day, four days per week. The concentrator suffers no notable losses from intermittent operation.

Lead flotati ........