The Castelo dos Sonhos Formation is a relic of a sedimentary basin that likely formed near the coast, where sediments eroded from higher elevations accumulated in alluvial fans and, occasionally, aeolian dunes. Most of the gold mineralization in the Castelo dos Sonhos Formation lies in a central band where the various conglomerate lithologies dominate. At the base and top of this band, the conglomerates are interlayered with arenites, which become more frequent as one moves away from the conglomeratic band, either downward into the older rocks (the lower arenite) or upward into the younger rocks (the upper arenite).

The vast majority of clasts in the conglomerate are from quartz veins; minor amounts of the pebbles consist of banded iron formation, quartzite, tourmalinite and, less frequently, metavolcanics. Significantly, no clasts of granite or andesite have ever been seen, indicating that these rocks, which lie beneath the Castelo dos Sonhos Formation, are due to intrusions that post-date the sediments. A few of the pebbles and cobbles are composed of the Castelo dos Sonhos Formation itself, indicating that successive lobes of the alluvial fan have sometimes scavenged and reworked older lobes beneath them.

As the continental crust of the Tapajós Domain accreted from the west, the foreland basin closed, and the sedimentary rocks of the Castelo dos Sonhos Formation were intruded by granites and andesite between 1.9 and 2.0 billion years ago. The sedimentary rocks were metamorphosed by heat from these intrusive events, and by hydrothermal fluids driven upward from the intrusions.

Gold occurs as free grains and flakes of various sizes, from sub-visible (less than 100 microns) to highly visible. In the near-surface workings dug by local artisanal miners, supergene enrichment creates nuggets that can reach a few centimeters in size.

The two predominant styles of mineralization are:
• Paleo-placer: Free grains of gold that were likely deposited along with the quartz-rich sediments. In core these can be seen in the matrix of the conglomerate, sometimes in heavy mineral bands.
• Remobilized: Gold associated with alteration, usually hematitic alteration. Free grains of gold have been observed in hematite-filled fractures, and as thin films plated onto fracture surfaces.

Gold mineralization occurs throughout the conglomeratic band. Although there are many barren samples within the conglomerate, there are gold grades above 0.5g/t in almost every drill hole that penetrates more than half of the stratigraphic thickness of the central conglomeratic band. Gold grades tend to be higher in the central cobble unit, often reaching several grams per tonne. The lowest grade encountered in drilling to date is below detection limit; the highest grade encountered in drilling to date is a 38g/t assay over a 2m interval. The existence of gold in heavy mineral bands, and its tendency to be more frequent in the proximal rocks are consistent with the view that most of the gold in the conglomerate band was deposited along with the sediments.

Where gold mineralization extends into the upper and lower arenites, such as the interval of 5–10g/t mineralization seen at the base of the upper arenite in several Esperança South drillholes, this is understood to be the result of remobilization caused by hydrothermal fluids. This remobilized gold in the arenites, along with direct observations of gold in direct association with hematite-filled fractures in the conglomerates, confirms that some of the gold within the conglomerate band must also be remobilized. The low temperatures of dike emplacement, the low grade of metamorphism, the difficulty of keeping gold in solution, and the proximity of the remobilized gold in the arenites to the conglomerate band all support the view that remobilized gold did not travel far from where it was originally deposited as paleo-placer gold. There is currently no evidence that any of the remobilized gold has migrated more than a few tens of metres.

The strike length of the mineralized conglomerate is approximately 16km; samples from outcrops and workings along the entire length of this band return both barren samples and well mineralized samples. The true width of the central conglomerate band is 250-300m at surface, the apparent width is close to true width in Esperança West, where the dip is vertical, and is approximately three times the true width in Esperança Center, where the dip can be as low as 20°.

The true depth of mineralization is unknown since the deepest parts of the conglomerate have never been encountered in drilling, but are known to be at least 500m from surface in the center of the plateau. In drill holes, well mineralized samples (above 4g/t) have been encountered at depths of 300m. The current mineral resource estimate spans the entire width of the conglomerate band (250-300m true width), but is restricted in its strike length by the availability of drilling and by the decision to report resources to a depth of only 150m. Some of the blocks on the edge of the current resource model are well mineralized, leaving the model open in the strike direction and down dip.

Esperança South
The mineralization in Esperança South is hosted in a series of stacked metaconglomerate beds striking north-south or northeast-southwest and dipping west, or northwest, at 30° to 35°, with thicknesses of individual mineralized reefs ranging from 2m to 20m. The mineralized reefs in Esperança South are thinner than in Esperança Center but have higher gold grades.

Esperança Center
The mineralization is hosted in a series of beds, striking north-south and dipping 20° to 30° west. Thicknesses of individual mineralized reefs range from 1m to 20m. Although the highest grades in Esperança South are higher than in Esperança Center, it is Esperança Center that has the higher average grade because it has far fewer very low-grade intervals. With more of the grade distribution lying close to an average of 0.2g/t, the thickness of mineralized horizons in Esperança Center increases as the cut-off used to define a significant interval is lowered. At cut-offs near 0.2g/t, Esperança Center has many thick intervals, some exceeding 50m.

Esperança East
Esperança East is more structurally complex than Esperança Center and Esperança South, with bedding directions often changing quickly between the available outcrops. Generally, the mineralization dips to the west, consistent with the view that the Esperança East block is the bridge between Esperança Center and Esperança South. Parts of Esperança East more closely resemble Esperança Center, with long runs of mineralization near 0.2g/t; other parts more closely resemble Esperança South, with grades occasionally exceeding 10g/t over short intervals.

The Castelo de Sonhos Project is projected to be an open pit operation using an owned mining fleet of 70 tonnes hydraulic excavators, front-end loaders and 42 tonnes haul trucks, associated with correspondent ancillary equipment.

The disposal of waste rock will take place on areas close to the pits. The site shall be adequately prepared to include drainage at its base and channels to direct the flow of water with the aim of aiding geotechnical stability and mitigating the erosion of the stockpiled material. The operation of this phase, in accordance with the ascending method, shall begin during the construction of the heap at the base of this area. Waste rock will be disposed by truck, which will then be uniformly distributed and leveled by an operator using a tractor. The procedure is then repeated, stacking another bank above the original one, while maintaining a ramp for the trucks to be able to access the area.

The Mine Design or Pit Design, consists of projecting, based on an optimal pit, an operational pit that allows for the safe and efficient development of mining operations.

The methodology consists of establishing an outline of the toes and crests of the benches, safety berms, work sites and mining site access ramps while adhering to the geometric and geotechnical parameters that were defined. The assumptions that were adopted for the design of the final pits for each period of mining were:
• Minimize the loss of mineralized material.
• Define the access routes to attain shorter average transport distances to the crushing circuit and waste disposal area.

Pit design parameters:
- Inter-ramp Slope Angle - 55º;
- Face Angle - 75°;
- Bench Height ROM - 8 m;
- Bench Height Waste - 10 m;
- Berm width - 5 m;
- Minimum bottom area - 30 m;
- Road Ramp width - 12 m.

Primary Crusher
10,000 dry metric tonnes per day. Twelve hours per day, seven days per week, 85% availability equals 980 dry metric tonnes per hour. Moisture content 2.5%.

Primary Stockpile
Nominally 40,000 tonnes total, with 10,000 tonnes effective capacity. Feed size 100% passing 300 mm 80% passing 150 mm.

Grinding
Final product to leaching P80 = 105 microns. Ball mill sized on testwork results (McClelland Laboratories, Sparks, Nevada USA). Bond Index (metric) 13.62, SAG mill sized on in-house data at 8 kWh per tonne.

Selected SAG mill 28ft (8.5 meters) diameter, 12 ft (3.6 meters) long, ball mill 18ft (5.5 meters) diameter, 25ft (7.5 meters) long, both with 3,750 kW motors (fixed speed drives) for common spare purposes.

Subsequent testing and analysis (Hazen Labs Golden, Colorado, USA 6 JK Simmet Red Bluff California USA) to produce P80 = 150 microns.

Suggests SAG mill 26ft (7.9 meters) diameter, 12 ft (3.7 meters) long 4,300 kW motor, ball mill 16ft (4.9 meters) diameter, 26ft (7.9 meters) long with 2,900 kW motor. Trade off will be needed in detail design to compare P80 =105 µm vs P80 = 150 µm and evaluate savings in grinding to coarser size against increased costs due to longer retention time in leach.

Trade off will be needed in detail design to compare P80 =105 µm vs P80 = 150 µm and evaluate savings in grinding to coarser size against increased costs due to longer retention time in leach.

A run of mine (“ROM”) stockpile area and the primary crusher dump hopper will be located adjacent to the Esperança South pit rim close to the centroid of the deposit. ROM ore will be hauled from the pit and either stockpiled for blending and/or subsequent reclamation by front end loader or direct dumped over a 400mm square opening stationary grizzly into the primary dump hopper, nominal capacity 150 tonnes. Sonic fogger dust suppression will be provided above the hopper. A rock pick mounted on the hopper will handle grizzly oversize. Ore will be withdrawn from the dump hopper with a vibrating grizzly feeder (1.6 x 3.7m with 150mm grizzly bar openings). Grizzly undersize will bypass the primary crusher, oversize feeds the primary crusher (1.25 x 0.95m jaw, set at 150mm).

Combined grizzly undersize and crusher discharge will be conveyed to a conical, uncovered, 40,000 tonnes total capacity coarse ore pile (live capacity nominally 10,000 tonnes, one day’s production). Ore will be reclaimed by two vibrating grizzly feeders (1.6 x 3.7m with 150mm grizzly bar openings) located in a tunnel beneath the pile.

The grinding circuit consists of an 8.5m diameter, 3.65m long (28 x 12 ft) fixed speed, 3,750 kilowatt semi autogenous (SAG) mill operating in closed circuit with a 200-kilowatt pebble crusher and (primary) cyclones followed by a 5.5m diameter, 7.5m long (18 x 25ft) fixed speed, 3,750 kilowatt, ball mill operating in closed circuit with (secondary) cyclones. Lime and sodium cyanide will be added to the SAG mill feed belt.

Whole ore agitation leaching has been selected as the preferred process flowsheet for project development. The plant will be designed to treat 10,000 tonnes per day through crushing, grinding, hybrid cyanidation and carbon in leach, carbon acid wash, pressure stripping, and thermal regeneration. Gold will be electrowon from loaded eluate. Metal deposited on stainless steel wool cathodes will be rinsed off, decanted and collected as “sludge” which will be dried and smelted to produce doré bars for shipment to third party refiners.

Combined primary and secondary cyclone overflows with P80 of 105 microns (150 mesh) in a slurry containing 40% w/w solids, pass through vibrating trash screens which discharge to the first of ten, 15.9m diameter x 16.8m high (52 x 55ft) cyanidation/CIL tanks operating in series for a total retention time of 36 hours. Air is injected into the first three leach tanks to promote gold dissolution and sodium cyanide solution is added to maintain a concentration of 1 g/l in leaching. The last five (CIL) tanks contain 10 g/t activated carbon. Intertank screens retain carbon in the CIL tanks, carbon is advanced through the circuit periodically by pumping slurry countercurrent to the normal slurry flow. Carbon remains in the recipient tank and slurry flows back downstream.

Loaded carbon containing nominally 2,000 g (65oz) of gold per tonne will be pumped out of the first CIL tank, discharged over a wash screen and advanced at the rate of eight tonnes per day to acid washing followed by elution in a pressure stripping system. Stripped carbon will be thermally regenerated in a gas fired rotary kiln operating at 1,200°F and returned to the fifth CIL tank.

Gold and will be electrowon from loaded eluate in three, 750amp cells operating in parallel. Metal deposited on stainless steel wool cathodes will be rinsed off decanted and collected as “sludge” which will be dried and smelted to produce doré bars for shipment to third party refiners.

Leached slurry discharged from the last CIL tank passes through safety screens to recover carbon fines and flows by gravity to the leach discharge thickener where it is diluted with water reclaimed from the tailings pond. Thickener overflow containing approximately 60% of the sodium cyanide in thickener feed is returned to the grinding circuit. Thickener underflow is pumped to cyanide destruction where will be diluted to 40% w/w solids with reclaim water, mixed with sodium metabisulfite, copper sulfate and lime and subjected to intense agitation with low pressure air to destroy residual cyanide down to approximately 1ppm weak acid dissociable (“WAD”) cyanide.

Cyanide destruction circuit effluent will be pumped to the tailings dam constructed approximately 6km from the plant. Process water will be reclaimed with barge mounted pumps in the pond and returned to the process water storage tank at the plant site. For the purposes of this study, it has been assumed that freshwater will be sourced from a well field close to the plant site. It may be necessary to change to a catchment dam across one of the drainages on site to store precipitation run-off for this purpose.