Mine area rocks are composed of a mafic to felsic volcanic-sedimentary sequence. The volcanic sequence consists of a Lower Andesite overlain by the Lower Agglomerate unit, a Lower Tuff, the Upper Agglomerate, and Upper Tuff units. A rhyolite porphyry stock occurs to the north of the mine and is exposed in the SAMS area. This stock may be part of a much larger intrusive body at depth.

The rock sequence forms an east trending homoclinal structure trending east with a northerly dip from 30° to 75°. At depth the sequence is sub-vertical to overturned. These rocks have been complexly faulted by steeply dipping north to north-northwest and northwest trending faults. Vein complexes trend north-northwest to north with some veins trending northwest.

Mineralisation is associated with multiphase quartz veining and silicification developed along predominant north to north-northwest trending faults. Some veins are developed along northeast and northwest trends. Quartz veining is associated with intense silicification, massive, laminated and brecciated veins. Veins are vertical to sub-vertical. Major vein systems can be traced across the mine area and are preferentially developed in the Lower and Upper Agglomerate Units. Veins are more poorly developed in the andesite and tuff units. Economic gold mineralisation is associated with quartz, pyrite, chalcopyrite, sphalerite, galena and silver.

Moderate to intense sericite and chlorite alteration is associated with the vein systems. Carbonate alteration and quartz veinlets form at the peripheries of the vein systems. Near surface mineralisation is oxidized to a depth of 10m grading into a transitional zone that extends to depths of 20m to 60m.

Mineralisation occurs in epithermal to mesothermal vein systems. Typically mineralisation is zoned according to the temperature and boiling point of hydrothermal fluids. Often lower temperature zones or epithermal environments are associated with high levels of gold mineralisation. Mesothermal environments are associated with massive metal sulphides and possibly a lower tenor of gold mineralisation. In a general overview of the upper regions of Mahd Ad’Dahab, vein systems show epithermal characteristics and are associated with high grade gold mineralisation. The deeper regions of the vein systems may represent a higher temperature regime and thus are associated with massive sulphide mineralisation with lower gold grades. Fluid inclusion studies indicate that veining occurred in epithermal to low mesothermal temperatures.

Mafic dykes intrude quartz veins. Dykes are believed to be post or contemporaneous with mineralisation.

Quartz and massive sulphide vein system at Mahd Ad’Dahab are subdivided into four zones comprising:

- SAMS: comprising 70% of ore currently mined, economic veins include veins 1, 4, 8, 14, 15, 16, 17 and D complex (veins D1 to D4);

- Western Zone: comprising 4 complex, 3 west, 2 west, F, F1, F2 and a number of narrow high grade veins from 0.4m to 0.5m wide including veins S, 10 West, 8 West, 6 West, 7 West, diluted grade of narrow veins about 10g/t Au;

- Eastern Zone: comprising 10 East, 11 East veins and the M vein complex;

- Northern Zone: comprising the Northern, 678, 345, T veins and the two vein complex, the near surface mineralisation of vein 678 was mined out as high grade mineralisation extracted through a small open-pit operation.

The mineralization occurs within an area about 900 metres by 900 metres in size. Mineralization is associated with multiple phases of quartz veining and silicification related to north to northwest trending faults. The high grade gold mineralization occurs as steeply dipping, narrow (0.5 metres to 2.0 metres) quartz and massive sulphide vein systems in four zones; SAMS, Western Zone, Eastern Zone and Northern Zone; and in larger stockwork veined zones up to 20 metres in width in the Eastern Zone.

The underground mine has over 60km of tunnels, and is mined over a vertical depth of 300 metres from the surface.

The main access to the underground operations is provided by a 1:9 decline, 4m by 4m in cross section which runs from the portal at 1,065m amsl to the 852m level. Access from this decline to the orebodies is via ramps and cross-cut haulages.

Mining methods include fully mechanised sub-level stoping and cut-and-fill with application depending on orebody dimensions. Currently some 75% of underground ore production is sourced from cut-and- fill mining methods with the fill being waste rock. Each cut is either 2m or 4m depending on orebody geometry and fill is placed in the stopes after each cut and stopped with sand (>50cm), which also acts as a marker between ore and waste.

All primary waste development, ore development and the cut-and-fill stopes are drilled using electro- hydraulic drill rigs.

Monthly production is currently 15.3kt of ore and 4kt of waste which is hauled up the decline to surface by Wagner dumptrucks loaded by Wagner load-haul-dumps (“LHDs”). Current haul distances result in round trips of some 30 minutes to surface and back to the loading point.

Mining operations extend to a depth of 190m from the general desert surface. Ground conditions are generally good although (ground conditions) in localised areas is poor which necessitates the use of roof-bolts, sometimes in combination with mesh. No formal support system is left in the stopes, however low grade areas are left in-situ which also limit mining spans.

Mining activities are serviced with compressed air from a central facility with an installed capacity of 231m3/min provided by five compressors, three of which are operational at any one time. Ventilation is provided via the main decline and all air is exhausted via a separate incline. Mine water is settled underground at the lower levels and pumped to the main header tank situated near the main decline portal on surface.

Copper flotation
The cyclone overflow material at around 35% solids by weight is fed into six automated Outotec copper flotation tank cells with a portion of the stream bled into a flash flotation cell. Zinc sulphate is added to the mill discharge hopper for conditioning before other reagents (collector and frother) are added into the conditioning tank and which are then fed to the cell (6 cells in series of 4 roughers and 2 scavengers), the easily floatable minerals are recovered through the cell launder overflow and sent to the copper cleaning stage, and then to the copper concentrate thickener depending on the concentrate grade after the cleaning stage. The flash flotation underflow is sent to the copper conditioning tank with the concentrate (overflow) joining the feed to the cleaner cells. From the cleaner the copper mineral is forwarded via a thickener to a dewatering filter (Larox) for filtering; the filtered copper is now in the form of copper concentrate.

Gold ........