The zinc-lead mineralization of the Lone Mountain Property is constrained to the Devils Gate limestone/dolostone. There are two distinct types of mineralization found on the Property. The first type of mineralization is easily distinguishable from the grey host dolostone by its pink, red, yellow, orange to brown colour and produces both high and low grade assay results. This mineralization occurs in the brecciated dolostone of the Devils Gate Formation and is composed mainly of smithsonite and hemimorphite as fine grained aggregates or crystalline components filling voids. The breccia is often clast supported but the mineralization can be found within the colourful fine-grained matrix of the breccia or in dolostone clasts. Lesser amounts of lead occur with this type of mineralization however no significant lead minerals were detected in recent mineralogical work. The second type of mineralization is more difficult to define as there appears to be no significant colour or textural differences to distinguish the mineralization from the fine to medium grained host dolostone. The mineralization is grey to grey-white and produces both high grade and low-grade assay results. White crystalline and fine-grained barite and carbonate (mostly calcite) veins are ubiquitous across the Property.

The mineralization is predominately hemimorphite (Zn silicate-hydroxide), smithsonite (Zn carbonate) and Zn-bearing dolomite. Within the Extension Shaft area of the Lone Mountain Mine, the mineralization appears to be restricted entirely to the rocks within the footwall of a D2 structure.

White crystalline barite is associated with the base metal mineralization as veins up to 3 m, and in other locations as infilling around limestone or dolomite breccias. Near the Lone Mountain Mine, the barite is closely associated with the lead-zinc occurrences. In Aurogin’s drill hole 07- 1, near the Mine, zinc mineralization contains barite and the cuttings contain barite chips between zones of high-grade lead and zinc mineralization.

The zinc-rich mineralization at the Lone Mountain Property has similar characteristics to the other carbonate-hosted replacement deposit of the Eureka District. This mineralization style is consistent with the supergene-type non-sulphide zinc deposits reviewed by Hitzman et al. (2003). In their summary review paper Hitzman et al. (2003) describe these deposits as forming as a result of weathering of Mississippi Valley-type and high- temperature carbonate replacement- type zinc deposits.

The current drilling program is part of a work program designed to evaluate the potential of the Project to host near surface zinc-lead Mineral Resources that could potentially be mined using low cost open pit mining techniques. The majority of the drill holes reported to-date from the Mountain View Mine Property and the Discovery Zone area of the Project have intersected near surface zinc-lead mineralization that is now known to extend from surface to a depth of approximately 250 meters beyond which it remains open to further expansion.

Based on the metallurgical test work completed to date, a preliminary mineral processing flow sheet for the Lone Mountain Project has been developed, which includes crushing, grinding, and zinc flotation to produce zinc concentrate for sale.

Portable crushing and screening equipment will be utilized at mine site to process approximately 1000 tonnes (dry) daily at an operating availability of 75%. Crushing operations are planned as a two-stage circuit with a screen to separate the final product size material for grinding.

Crushing will be performed on a nominal 6 days per week schedule. Coarse and fine (crushed) material stockpiles are utilized to separate the mining and milling operation ROM material is trucked to the crushing plant and dumped into stockpiles located near the crushing equipment. The two-stage crushing reduces the rock from a maximum feed size of 400 mm down to 80% passing 10 mm. The crushed material is transferred to a fine (crushed) material storage bin feeding to a primary grinding mill.

A grinding circuit is included to reduce material particle size to P80 of 75 microns required for downstream flotation process. The grinding circuit employs a wet-overflow type ball mill and a cyclone to form a closed-circuit with 150% circulation load.

The crushed material is transferred from crushing area by a series of conveyors to a storage bin located close to the grinding area. Material discharges onto a mill feed conveyor discharging to a cyclone feed pump box. A belt scale is installed to weigh and record feed rate to the processing plant.

The crushed material is ground in the ball mill. Ball mill discharge flows by gravity to the cyclone feed pump box from where slurry is pumped to a hydrocyclone for size classification. Cyclone overflow stream with particle size P80 of 75 microns flows by gravity to a rougher flotation conditioning tank located in the flotation area.

The flotation process to recover zinc minerals includes zinc rougher and scavenger, rougher concentrate re-grinding, and 3-stage zinc cleaners. The concentrate from the 3rd cleaner is the final product with 45% zinc content. The flotation tailing is dewatered in a thickener for process water recovery prior to being disposed to designated tailings management facility (TMF).