Regional Geology
True North is underlain by the Archean Rice Lake greenstone belt located at the west end of the Uchi Volcanic-Plutonic Subprovince of the Superior Province. The Rice Lake greenstone belt is bound to the north and south by the Wanipigow Shear Zone and the Manigotagan Shear Zone, respectively.

The rocks in the True North area were affected by at least three and possibly four major periods of deformation (Anderson, 2008). The resulting fold pattern is complex with overturned, doublyplunging folds in the Rice Lake Group rocks. The late Archean San Antonio Formation sedimentary rocks may have been affected by only the last major period of deformation.

All the major gold occurrences in the True North area occur as quartz veins or quartz vein systems formed during structural deformation of the host rocks.

Local Geology
All of the gold mineralized zones at True North are hosted in rocks of the Bidou Lake Assemblage. The Bidou Lake Assemblage forms a north-facing stratigraphic sequence of tholeiitic basalt to intermediate volcanic flows, dacite crystal tuffs and breccias overlain by well stratified felsic epiclastic rock interpreted to be of pyroclastic and sedimentary origin. The stratigraphic sequence is intruded by tholeiitic gabbro sills and dykes and felsic porphyry dykes.

Structure
The structures that control the gold mineralization are brittle-ductile shear zones which strike from parallel to transverse to the host rock units and dip steeply northwest or northeast. The shear zones are marked by intensely foliated and lineated interlayered sericite and chlorite schists, which range from 10m thick

Structures trending east-northeast have kinematic features indicative of sinistral-reverse movement, whereas those trending northwest have kinematic features indicative of dextral-normal movement.

The structures contain a main, banded (laminated) quartz vein and subsidiary veins in the schist on either side. The main vein can be situated anywhere in the structure.

Veins
According to Anderson (2008), shear-hosted veins include massive, laminated and brecciated varieties, commonly within the same vein, and typically pinch and swell along strike and downdip. Thicker veins are associated with inflection points in the host shear zones, which suggests hydrothermal infill of dilational jogs.

In the True North deposit, the gold-bearing quartz veins occur mainly as either “16-type” hear zone veins or “38-type” tensional fracture stockwork veins or, where they intersect, as a combination of the two vein types. The 16-type appear to be fault fill veins with generally higher grades and more continuity, which are laminated with pressure solution seams (stylolites) and trend north-northeast.

The stylolites consist of intergrown pyrite-chlorite-tourmaline-muscovite. Compared to the 16- type, the 38-type are stockwork breccia veins that are wider and arranged in an en-echelon pattern along the strike and down the dip of the host gabbro unit, but gold mineralization is more irregular and grades difficult to predict.

In addition to quartz, the veins contain subordinate carbonate, minor albite, chlorite and sericite, and rare tourmaline and fuchsite (a.k.a. mariposite). The carbonate is dolomite- ankerite in composition (Ross & Rhys, 2010). Sulfide minerals consist of pyrite with minor chalcopyrite and rare sphalerite, galena and gold-silver telluride minerals. Pyrite generally comprises.

Gold typically occurs as free grains associated with or as inclusions in pyrite. Gold grades tend to be highly erratic within individual quartz veins. The gold ores have high Au/Ag ratios of >5:1 and low concentrations of copper, lead, zinc, arsenic, bismuth, boron, antimony and tungsten, as is typical for Archean lode-gold deposits.

In the True North deposit, thick zones of altered and sulphidized wall rock with minor vein quartz contain ore grade gold.

The True North and SG-1 deposits show close spatial relationship with laterally continuous zones of ankerite-sericite phyllite and phyllonite, which represent reliable guides to ore.

Despite vertical extents of up to >2 km, the True North deposit shows only minor variation in vein mineralogy, texture and structure.

Deposit Types
The association of gold at True North with quartz-carbonate veins in brittle-ductile shear zones and laterally extensive hydrothermal alteration zones indicates that the deposits represent epigenetic mesothermal lode gold-type or orogenic-type gold mineralization.

For the year ended December 31, 2019, the Company operated for 188 days, commencing tailings operations on April 26, 2019, and suspending operations on October 31, 2019.

During the year ended December 31, 2018 the True North underground mine operations transitioned to care and maintenance as a result of ongoing negative cashflows, with tailings operations commencing on April 20, 2018. During the transition period True North mined 19,301 ore tons from areas that were already developed, producing 2,091 gold ounces. An additional 230,427 tons were processed from tailings during the year ended December 31, 2018, producing an additional 5,906 ounces.

The primary mining method at the Project is long-hole stoping which is a cost effective method to mine the complex geology at the Project, and benefits from a quick stope cycle time. In areas where mineralization does not warrant the development of a ramp access system, Klondex employs captive sublevel stoping methods.

Longhole Stoping:

Long-hole stoping is the lowest cost method used at the Project and generally also provides the lowest total cost per ounce of gold produced.

Level accesses are driven perpendicular towards the ore body every 60 feet (18m) vertical. From these access drifts, 8 foot x 9 foot (2.4m x 2.7m) sills are developed along the strike of the mineralized zone.

Once the levels are developed, a slot raise is driven between the levels which provides the free face necessary for long-hole blasting. Subsequently, long-hole drilling is carried out with 2.5 inch (64mm) holes on a 3foot (0.9m) ring burden. The actual drill pattern is determined by the stope shape.

Once all long-hole drilling is completed, the stope is loaded with explosives and blasted. A diesel powered load-haul-dump machine (LHD) is used to move the blasted material from the undercut. The LHD is equipped with line-of sight remote control mechanism to allow the removal of all blasted rock without exposing operating personnel to the open stope and the potential risk of ground falls.

Captive Sub Level Longhole Stoping:

Captive sub level long-hole stoping is used in situations where an up-ramp access cannot be economically justified. This mining method uses three 6 foot by 6 foot (1.8m by 1.8m) raises up to 60 feet (18m) in length. One raise acts as a slot raise for the long-hole blasts to slash into; the second raise acts as a mill-hole for muck from the sublevel where broken ore is slushed into; and the last is a access man-way. At the top of the raises an 8 foot by 9 foot (2.4m by 2.7m) sublevel is driven along the strike of the ore body. An air slusher is used to move the development muck from the sublevel over to and down the mill hole. If the mineralization warrants, another series of raises and a sublevel are developed.

After all of the raises and sublevels are developed, long-hole drilling is carried out with an air drill capable of drilling 2.5 inch (64mm) holes on a 3 foot (0.9m) ring burden. These rings are blasted into the slot raises. The material drops to the bottom level and a remote controlled LHD removes the blasted ore without exposing the operator to the open stope and the potential risk of ground falls.

Backfill:

Waste rock is moved from development to stoping whenever possible and major fill zones are created in the mining through the down hole longhole method on the 710 incline. The decline will not create fill void and will require sill pillars at certain level intervals. With the mining in the incline being filled, a percentage of waste rock will need to be removed from the mine but there will be sufficient material to fill the created void.

In 2011, the process crushing plant was expanded by adding a new primary 30 inch by 42 inch (760mm by 1067mm) jaw crusher, a GP300 gyratory crusher as a secondary breaker and a Barmac B8000 VSI (vertical shaft impact) crusher as a tertiary unit. There units are all in line with a 7 foot by 20 foot(2.1m by 6.1m) triple deck vibrating screen.

The process plant feed is ground in an AC 12 ½ foot by 14 foot (3.8m by 4.3m), 1,250 HP (933 kW) ball mill to 67% passing Tyler 200 mesh (74 microns). A portion of the process plant circulating load is passed through one of two 20” (500mm) gravity concentrators. Concentrate from these units s upgraded on an 8 foot (2.4m) shaking table. The table concentrate is direct smelted. Tails from the concentrators and the shaking table are returned to the head end of the grinding mill. The fines from the grinding circuit are fed to one of two rows of 10m3 OUTOTEC tank cells producing both a rougher concentrate grading between 5 and 10 opt (171 and ........