The Taguas Property is host to a high-sulfidation epithermal gold-silver system hosted in altered tertiary age rhyolite volcaniclastic rocks. Supergene-oxidized gold-silver mineralization occurs on the south half of the Property. The oxide gold-silver mineralization consists of sub-vertical, northeast striking mineralized structures in an envelope of lower grade mineralization. The high grade zones consist of relatively continuous mineralization with gold grades ranging from 0.2 g/t Au to over 4.0 g/t Au and 10 g/t Ag to over 50 g/t Ag. Oxidation extends from surface to approximately 100m – 200m below surface.

Taguas consists of three gold-silver deposits:
• Leonor Vein at Cerro Silla Sur;
• Campamento Vein at Cerro Campamento;
• The gold-silver mineralization at Cerros Taguas.

The present PEA refers only to this oxidized gold-silver mineralization occurring near surface in Cerros Taguas.

Cerro Silla Sur
Cerro Silla Sur contains a northeast trending and steeply dipping (to the northwest) quartz-pyrite-enargite vein called Leonor. The central portion of the Leonor vein has returned grades of 7 to 42 g/t gold, up to 330 g/t silver and 0.1 to 5 % copper over drill intersections of less than 1 m to 7 m (Hedenquist, 2012). The mineralogical characteristics of the Leonor Vein are consistent with it being of the intermediatesulfidation type as evidenced by increasing amounts of chalcopyrite relative to enargite. Such intermediate- ........

A preliminary mine plan for the Cerros Taguas oxide material is focused on a main and secondary mine areas, mined through consecutive mining phases or pushbacks.

The mining method proposed for the Taguas Project is conventional truck and shovel open pit mining.

The mine plan will process 5.5 Mt/year with a peak total mining rate of 14.0 Mt/y in Years 2 to 4. The 6-month pre production period requires the mining of 2.4 Mt of total material to expose sufficient mineralized material to start commercial production in Year 1.

The total mined waste considers two main destinations for the material, the main east waste storage area to the east of the pit and the west waste storage area to the west of the south pit. The mined leach material will be hauled to the primary crusher for direct tipping. Low grade material will be mined and hauled to a stockpile located between the pit and the plant area until Year 7. This material will be re-handled and will become part of the plant feed in the later years.

The mine is scheduled to operate seven days per week or 365 days per year. Each day will consist of two 12-hour shifts. Four mining crews will rotate to cover the operation.

Pit Design
The bench configuration used for the mine design:
Inter-ramp angle (IRA): 45°;
Bench angle: 65°;
Bench height: 5m;
Berm width: 3m;
Max slope height: 100m;
Catch berm: 10m;
Ramp width: 13m;
Ramp gradient: 10 ........

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Test work results indicate that the oxide portion of the Cerros Taguas mineral resource is amenable to heap leaching for the recovery of gold and silver values. Material will be crushed at a rate of 15,000 tpd to 100% passing 12.5 mm using a three-stage closed crushing circuit and conveyor stacked onto a leach pad in 10 m lifts. Lime will be added to the material for pH control before being stacked and leached with a dilute cyanide solution. Pregnant solution will flow by gravity to a pregnant solution pond before being pumped to a Merrill-Crowe plant for metal recovery. Gold and silver will be precipitated from the pregnant solution via zinc cementation. The precious metal precipitate will be dewatered using filters, dried in a mercury retort to recover mercury values, and smelted to produce the final doré product.

A Merrill-Crowe recovery plant was selected instead of a conventional carbon adsorption circuit due to the high recoverable silver values.

The p ........