The regional setting, geometry, and zinc mineralogy indicates that the Zinc and Tin Zones of the Ayawilca deposit are CRDs, of which there are several other type examplesin central Peru (e.g., Cerro de Pasco, Morococha, Colquijirca, and San Gregorio). These deposits typically develop when hydrothermal fluids replace carbonate rocks proximal to an intrusive body, although in some cases the causative intrusive body is not observed. CRDs are considered more distal from the source than porphyry and skarn deposits, but closer to the source than intermediate- (or low-) sulphidation epithermal precious metals deposits.

The Ayawilca deposit differs from most other CRDs in central Peru in that there is an early tin–copper mineralization event associated with pyrrhotite. The QPs note that early pyrrhotite tin–copper mineralization is reported at the Cerro de Pasco deposit, although apparently it is not so well developed as at Ayawilca.

The oldest rocks mapped on the Property are phyllite metamorphic rocks which belong to the Devonian Excelsior Group. These outcrop in the north–central and eastern portions of the Project area, and consist of light coloured quartz–sericite–chlorite phyllite and minor graphitic schist. Foliations strike generally northwest–southeast with gentle to moderate dips to the southwest and northeast. The large phyllite outcrop is interpreted to be the core of an anticline (basement high) bounded by two sub-parallel northwest-trending Andean faults approximately 2 km apart, and crosscut by several northeast-trending trans-tensional faults.

The Project hosts several styles of mineralization within numerous deposits, zones, and target areas. Mineral Resources have been estimated at the Ayawilca deposit within the Zinc and Tin Zones, and the Colquipucro deposit. Other target areas on the Property that warrant additional exploration work and include Chaucha, Zone 3, Valley, Far South, Yanapizgo, Pucarumi, and Tambillo.

Ayawilca Zinc–Lead–Silver Mineralization
Zinc mineralization within the Ayawilca deposit is predominantly hosted within a sequence of limestone breccia, limestone, dolomite, calcareous siltstone, arenite, and greywacke, of the Pucará Group. The Zinc Zone is made up of multiple, gently-dipping, sulphide lenses or “mantos”, generally with vertical thicknesses of between 10–30 m (locally thicker) within four areas (West, South, Central, and East). At the West and South areas the mantos are stacked on top of each other to form almost continuous zone with vertical thicknesses up to 150 m, comprising several flat-dipping mantos each up to 70 m thick.

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 area measures approximately 640 m in length in the north–south direction and 300–450 m in the east-west direction, while the South area measures approximately 550 m in length in the northeast–southwest direction and 250 m in the northwest–southeast direction.

Zinc mineralization occurs as massive to semi-massive sulphide replacements of the carbonate 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. Zinc occurs as various generations of sulphide impregnations (mostly marmatite, a high-iron variety of sphalerite also known as “black jack”) and sphalerite (with purple to red–brown tones) accompanied by abundant pyrite, pyrrhotite, chlorite, iron carbonate (siderite), and magnetite. Less common sulphides include galena, chalcopyrite, arsenopyrite, and silver sulphosalts. Multi-element geochemistry indicates that indium is correlated with the zinc mineralization.

Narrow, high grade marmatite-sphalerite veins and mantos cut through the Goyllar sandstone, and occasionally have broken through to the surface (e.g., in the West and South areas). Veins are typically 0.2–1.0 m in width. At Pucarumi,zinc oxide mineralization is hosted by favourable bedforms in Chulec Formation limestone.

Late carbonate–sphalerite–galena–proustite veins within the South and West areas are interpreted to be steeply-dipping, exhibit epithermal textures, and are interpreted to be the last mineralization event. This style of vein mineralization has not been modelled as part of the Mineral Resource; however, these veins can have very high silver grades and offer further potential for later exploration.

At the South area, pervasive carbonate alteration of limestone accompanied by galena and silver sulphide minerals, including polybasite and freibergite, was intercepted in the southwestern-most drill holes peripheral to the Zinc Zone at the Silver area, and remains open in all directions.

Zinc mineralization is generally associated with argillic alteration within the carbonate host rocks. Disseminated clots of white clays (dickite) are common within and near the mineralization. Dickite and illite are widespread and were identified using short-wave infrared spectrometry. Higher temperature clays, such as pyrophyllite, are observed in the Central area, suggesting a possible thermal aureole centred on this zone.

Ayawilca Tin–Copper Mineralization
The tin mineralization (Tin Zone), which occurs with minor copper as chalcopyrite, is hosted in massive to semi-massive pyrrhotite mantos typically 5–10 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, although tin bearing mantos also occur higher in the limestone sequence especially at the South area. Quartz–tin–copper stockwork mineralization also occurs within the phyllite in some areas beneath the pyrrhotite mantos.

The Ayawilca deposit is planned to be mined using underground mining methods. To define the mining method, the University of British Columbia (UBC) mining method selection system was applied, together with consideration of aspects such as safety, the geometry of the resources, the distribution of grades, the scale of production and mining costs. Based on this analyses, two suitable mining methods were selected:
- Overhand cut-and-fill (OCF) with pillars;
- Sub-level stoping (SLS).

The mining strategy involves dividing the deposit into five zones by spatial location and by mining method:
- OCF with pillars: Central and East areas;
- SLS: West, South areas and Silver Zones.
The netsmelter return cut-off was defined at US$65/t, asit covers mining, processing, general and administrative costs and sustaining capital costs, and was determined to be a reasonable balance considering the margin per tonne of material mined while still having a reasonable resource extraction and mine life.

The production rate was set at 8,500 t/d after considering the sustainable rate achievable from the multiple mining areas. Optimizations were completed using the mineable shape optimiser (MSO) unit within Datamine software. The SMU length and height were fixed values, whereas the width varied by zone and mineralized structure, from 5–45 m. Sections of 5 x 5 m were defined for the development drives and the Central area pillars.

A mining recovery of 95% was assumed for the SLS method and a 100% mining recovery was used for the OCF with pillars method. In the areas to be mined by OCF with pillars, it was assumed that pillars will be recovered in the last years of the mine plan. A recovery of 70% was assumed for these pillars, because the rock conditions may not be entirely favorable due to the initial mining within the zone.

A variable mining dilution assumption (% dilution) was applied, depending on the mining method, and consisted of internal dilution based on the defined stope sizes. No external unplanned dilution was included in the 2021 PEA since the stopes are generally continuous in nature. Future studies may result in the stope shapes being refined to potentially consider less internal dilution.

Backfill will be required to support the proposed mining methods. A combination of rock fill and paste backfill is proposed:
- SLS stopes: will require paste fill; the mining method assumes continuous mining in a retreat fashion;
- OCF: will require rock and paste fill; the mining method assumes primary stopes filled with paste, and secondary stopes are filled with rock fill.

The stope fill volume required was provisionally estimated at 15.8 Mm3. Consideration of inputs such as the rock geomechanical properties and the mine design and stoping sequence indicated that there was a stope volume of about 3.34 Mm3 that did not require any fill materials. The LOM design assumed that 12.46 Mm3 of backfill material would be required, consisting of:
- Rock fill: 3.3 Mm3;
- Paste fill: 9.2 Mm3.

The mine is planned to access the mineralization through a system of three main ramps, which will access the five proposed main mining zones.

The ramp system will have variable gradients, including:
- Maximum gradients of ±13%;
- Gradients on curves of ± 8–10%;
- Gradients on the sublevels, accesses and chambers of ±0.5–1%.

The mine plan assumes the following:
- A 2,815 m ramp will be developed from level 4,170 to access the South area. This area will be later accessed by the second ramp that will be developed for the Silver area from level 3,880. This ramp will be 713 m long;
- The West area will have an independent ramp access of 3,430 m length. The portal will be located at an elevation of 4,280 masl;
- During Year 7, a 2,995 m ramp will be constructed from elevation 4,095 masl to access the Central area. A 199 m cross-cut will be developed on level 3,845, and will connect to the East area. The East area will have a 1,964 m long ramp to support mining activities;
- A 377 m long connection ramp will join the Central and West areas to provide haulage flexibility and alleviate congestion. This will allow either the Central or the West area ramps to be used.

Primary Crushing
Run-of-mine (ROM) material will be hauled by dump trucks from the underground mine to the crushing area on surface where the mill feed material will be discharged into a ROM bin. The bin will be installed with a static grizzly and a hydraulic rock breaker to fracture the oversize rocks.

An apron feeder will recover material from the bin, feeding the vibrating grizzly where first coarse classification occurs. The oversize mill feed material will be sent to a primary jaw crusher, while both the crushed and undersize passing material will be transported by conveyor belts to the coarse stockpile. The belt conveyor will be equipped with an electromagnet to remove metallic objects that could damage the equipment downstream.

Coarse Stockpile and Crushed Ore Handling
The coarse stockpile will act as surge protection to ensure the concentrator continues to operate while the mine or crushing plant are not producing. From the coarse stockpile, vibratory feeders will reclaim coarse mill feed material to feed into the grinding circuit.

Grinding, Classification
SAG mill discharge will be screened by a trommel. The coarse scat material will be placed by conveyors onto a scat stockpile, which will be periodically removed by front end loader to either the SAG feed, or else to waste storage. The trommel undersize will report to a pump box along with the tailings from the lead-silver flotation rougher flotation cells. At the pump box, a centrifugal pump will feed a hydrocyclone cluster which will classify the material so that it is suitable for zinc flotation.

The fine hydrocyclone overflow material will be transported by gravity to the zinc rougher conditioning stage prior to being sent to the dedicated zinc flotation circuit. The coarse hydrocyclone underflow material will report back to the ball mill for further grinding.

Processing of the zinc mineralization will be through a conventional primary crushing, semi-autogenous grinding (SAG), secondary ball mill grinding, lead and silver flotation, zinc flotation, concentrate thickening and filtration. The concentrator plant will produce two concentrates: a zinc concentrate and a lead–silver concentrate. A portion 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 filtered, then disposed of on a filtered tailings storage facility (TSF). Process water will be recycled as much as possible to minimize water usage.

An 8,500 t/d throughput rate was selected as the basis for the 2021 PEA. A lean, fit-for-purpose plant design standard was used, to cover the required duty for the projected 14 year mine life. The design will accommodate nominal operation with a small degree of capacity flexibility for upsets and variability, but has no consider ........