The regional setting, geometry, and zinc mineralogy indicates that the Ayawilca Zinc Zone is an example of a carbonate replacement deposit or CRD, of which there are several other type examples in central Peru (e.g., Cerro de Pasco, Morococha, Colquijirca, and San Gregorio).

The Ayawilca Zinc Zone differs from most other CRDs in central Peru in that it has early tin– copper mineralization associated with pyrrhotite at the Ayawilca Tin Zone.

The Ayawilca Zinc and Tin Zones are hosted mostly within a sequence of limestone breccia, limestone, dolomite, calcareous siltstone, arenite and greywacke, of the Pucará Group.

Ayawilca Zinc Zone
The Ayawilca Zinc Zone is made up of multiple, gently-dipping sulphide lenses, or mantos, generally with vertical thicknesses of 10–30 m (locally thicker) within four areas (consisting of the West, South, Central, and East Ayawilca Zones, respectively).

The four structural zones span 2.1 km in the northeast–southwest direction and 1.3 km in the north–south direction. Each zone has been modelled separately. The West Ayawilca Zone is approximately 640 m long in the north–south direction and 300–450 m in the east–west direction. The South Ayawilca Zone is about 550 m long in the northeast–southwest direction and 250 m in the northwest–southeast direction.

Multiple mantos were intersected in the Central and East Ayawilca Zones, but only those showing sufficient continuity between drill sections have been modelled as part of the Mineral Resource estimate.

Zinc mineralization occurs as massive to semi-massive sulphide replacements predominantly of the carbonate rocks and to a lesser extent of Lower Goyllar clastic rocks, and is thought to be controlled by multiple, sub-parallel, east–west-, and northeast–southwest-trending structures, as well as low-angle thrust faults. The mineralized zones are interpreted to be generally gently dipping, replacing favourable sedimentary units. The zinc occurs as various generations of sulphide impregnations (mostly marmatite, a high-iron variety of sphalerite also known as “black jack”) accompanied by abundant pyrite, pyrrhotite, chlorite, iron carbonate (siderite), and magnetite. Minor sulphides include low-iron sphalerite, galena, chalcopyrite, and arsenopyrite. Multi-element geochemistry indicates that indium is correlated with the marmatite zinc mineralization.

Ayawilca Tin Zone
The tin mineralization, which occurs with chalcopyrite, is hosted in massive to semi-massive pyrrhotite mantos typically 10–20 m in vertical thickness (up to 50 m) typically at or near the contact of the Pucará Group carbonate rocks and the Excelsior Formation phyllite. The pyrrhotite is strongly magnetic, and is believed to be the main source of the large magnetic anomaly.

Massive pyrrhotite hosts most of the tin (±copper) mineralization following replacement of limestone beds; however, pyrrhotite veins also cut the underlying phyllite near the contact with the limestone. Drill hole A15-039 cut a network of tin–copper-bearing millimetre to centimetre scale veinlets over a vertical thickness of approximately 40 m that may represent part of a feeder system to the pyrrhotite lenses. The thickest vein measures 10 cm and contains chalcopyrite and arsenopyrite. No conclusive deep- seated feeder fault system for the tin mineralization has been found to date.


The Colquipucro Silver Zone is believed to be the only documented sandstone-hosted oxide silver occurrence in Peru. Silver is hosted in fractures, faults, and veins with abundant iron oxides (goethite, jarosite) in fractures and disseminations within the pore spaces of the sandstones. The Colquipucro Silver Zone is tentatively classified as a now oxidized disseminated, intermediate sulphidation epithermal deposit.

The Colquipucro Silver Zone has been modelled to include 10 north-dipping highgrade zones, a gently-dipping basal zone, and a low-grade halo that encompasses all high-grade zones. Overall, the mineralization extends for about 550 m in the north–south direction by 380 m in the east–west direction by 75 m thick.

The silver mineralization is hosted in quartz sandstones and occurs with abundant iron oxides (goethite, jarosite) and manganese oxides in fractures and disseminations within the pore spaces of the sandstones. Sulphide minerals are rare, though galena is observed occasionally. The fracture-controlled mineralization is epigenetic and crosscuts the primary bedding. Mineralized fractures are highly limonitic, locally manganiferous, and can also contain friable gouge and sand. Fracture spacing ranges from a few to many tens of centimetres.

The Ayawilca Zinc Zone is planned to be mined using underground mining methods.

Based on analyses, and taking into consideration other aspects such as safety, the resource continuity geometry and grade distribution, production scale and costs, a room-andpillar (R&P) and a variation (post- pillar or P&P) were selected. Approximately 50% of the Ayawilca Zinc Zone would be mined using conventional R&P, and the remaining 50% using P&P.

The RPA block model is the basis of the mine plan. The mine production schedule assumes a mining and processing rate of 5,000 t/d, based on a trade-off study.

Once the cut-off value had been determined, the mine plan was developed to include provision for external dilution, at an average 5% for R&P mining methods and 10% for P&P methods. No internal dilution was included as the assumption is that waste blocks can be mined separately or left in place as pillars, given the block size assumption of 10 m x 10 m x 5 m. The final step was to include mining recovery considerations. Mining recovery is estimated at 80% for both the R&P and P&P methods.

The main levels will be spaced at 70 m vertical intervals, with a sub-level at 35 m spacing. Production was assumed to start in the upper levels targeting higher-grade material and zones that could support a sustainable production rate. Because of the shallow dip of the mantos and assuming favorable ground conditions exist, only minimal or no horizontal pillars will be needed in between levels. In addition, no crown pillar was considered due to the depth of the Ayawilca Zinc Zone below surface.

Mined-out stopes will be backfilled as necessary to provide a safe working environment.

It is expected that conventional R&P will be applied in zones with moderate to intermediate thicknesses and variations of this method, such as open stopes with pillars or R&P with benching could be applied in other zones.

Thickness contours of the mineralized domains were plotted at a 15 m threshold, and indicated that approximately 50% of the Ayawilca Zinc Zone could be mined using conventional R&P, and 50% using P&P where the thickness of the mineralized zones is >15 m.

The mine design assumes 70 m spaced levels, with sub-levels at 35 m intervals. No sill pillar is planned.

A ramp system will be used to access the mine, connecting the mine portal to the underground infrastructure, including the mine production areas. The ramp crosssection was sized based on the ventilation requirements. It was assumed that the ramp will have a maximum gradient of 12% and curves and intersections will be developed at a maximum gradient of 10%.

Two access portals, the North 4255 and West 4035, were designed as the main and secondary accesses respectively.

The North 4255 ramp will intersect the top of the mineralization at elevation 4,146 and the development will continue down to the elevation 4,000 before production starts at this location. A secondary ramp will be developed simultaneously starting at the West 4035 portal. Access to the production locations will be possible by developing drifts and crosscuts branching off from the North 4255 ramp.

The two main ramps will connect at elevation 3,970 and once connected, a one-waytraffic rule will be adopted to address the expected heavy traffic of trucks and other mobile equipment to and from the production locations.

Backfill.
Approximately 50% of the tailings will be used in paste backfill. It has been estimated that approximately 25 m3 of paste backfill per hour will be required. Waste rock from mine development will be used for cemented rock fill (CRF) as required to provide additional ground support. Borrow material from a nearby surface pit will be used to complete any rockfill deficiency as required.

Mine infrastructure facilities will include haul roads, mine truck shop, fuel storage facility, explosives storage magazine, warehouses, dry change room, offices, and backfill plant, water and power distribution, and communications.

Processing of the zinc mineralization will be through a conventional primary crushing, semi- autogenous grinding (SAG), secondary ball mill grinding, coarse lead and standard zinc flotation, concentrate thickening and filtration. The concentrator plant will produce two concentrates: a zinc concentrate which is anticipated to assay 50% Zn based on metallurgical testwork; and a lead–silver concentrate which is anticipated to assay 50% Pb and between 2,750–5,930 g/t Ag. Approximately 50% of the tailings will be mixed with cement and used as structural mine backfill material in the underground operations, while the remainder will be thickened and disposed of in a conventional tailings storage facility (TSF). Process water will be recycled as much as possible to minimize water usage.

A 5,000 t/d throughput rate was selected as the basis.

The processing plant will consist of the following unit operations:
- Primary jaw crushing.
- Crushed ore handling.
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