The deposits and other prospects within the Casposo property are examples of low-sulphidation epithermal deposition of gold and silver. [p. 20]

The Casposo gold–silver mineralization occurs in both the rhyolite and underlying andesite, where it is associated with banded quartz–chalcedony veins, typical of low sulphidation epithermal environments. Adularia in the main veins gives an age date of 280 ± 0.8 Ma (K/Ar), very close to the published age dates for the andesite unit. Post-mineralization dykes, of rhyolitic (Kamila), aphanitic-felsic and trachytic (Mercado) composition often cut the vein systems. These dykes, sometimes reaching up to 30 m thickness, are usually steeply dipping and north–south oriented. [p. 51]

Mineralization at Casposo occurs along a 10 km long west–northwest to east–southeast trending regional structural corridor, with the main Kamila Vein system forming a sigmoidal set 500 m long near the centre. The Mercado Vein system is the northwest continuation of Kamila, and is separated by an east–west fault from the Kamila deposit. A series of east–west striking veins (Cerro Norte and Oveja Negra systems) appear to splay off these major sets to the east and northeast. The Casposo mineralized district identified to date covers an area of approximately 100 km2. [p. 51]

KAMILA DEPOSIT
The gold–silver mineralization at the Kamila deposit is structurally controlled and occurs in crustiform-colloform quartz veins and stockworks in both andesite and rhyolite. The vein system extends for over 650 m along strike and over 260 m in depth, with a general dip of - 60º to -70º to the southwest. At surface, the individual veins attain 12 m maximum thickness, which decreases with depth to less than 4 m. Arsenopyrite and stibnite occur in the stockworks zones that are developed adjacent to the gold-bearing veins. Vein alteration is characterized by strong to pervasive silicification. Wallrock alteration varies from argillic to propylitic. Banded quartz–calcite veins with lattice bladed textures are common in the andesite. [p. 58]

MERCADO DEPOSIT
The Mercado Vein system is exposed 200 m north of the Kamila deposit and is separated from it by the east–west-trending, south-dipping Mercado Fault. This northwest–southwest-trending hydrothermal quartz vein zone extends for over 500 m along strike, and over 150 m in depth, dipping -45º to -50º to the southwest. The Mercado system is variably composed of a compact vein (Main Mercado Vein or MV-1 Vein) or various thinner parallel veins, from which the north– south-trending MV-1 Vein splits. At surface, the Mercado Veins reach 8.0 m to 10 m in thickness (including over 4.0 m for the MV-1 Vein), but widths generally decrease with depth to less than 4.0 m.

JULIETA DEPOSIT
The vein system is well exposed as two outcropping veins along a ridge line having an average width of about 1.7 m and a maximum width of 5 m. These veins trend northwest, extending for approximately 850 m along strike and 150 m in depth with dips averaging -65° to the southwest.

The Casposo Mine consists of a number of narrow steeply dipping orebodies known as Aztec, B-Vein, B-Vein 1, Inca 0, Inca 1, Inca 2A, Inca 2B, Mercado, and Julieta. Open pit mining in Kamila and Mercado pits was completed in 2013, and all mining is currently planned as underground, although there is potential for open pit mining at Julieta. The main production from the underground mine to date has been from Inca 1, Aztec, and Inca 2A.

The mining method used at Casposo is longitudinal longhole retreat. Mine production is made up of a combination of ore development through sill drifts (34%) and stope production (66%).

The veins are accessed by sub-level footwall drives, driven from the main ramp at 15 m intervals. Stopes were designed using a minimum mining width of 2 m and are 10.5 m high, while sill drifts were designed at 4.5 m high and on average 4.0 m to 5.0 m wide. Stope lengths vary depending on the orebody but are limited to a maximum of 15 m due to geotechnical constraints.

Mining progresses in a bottom up fashion. Stopes on each level are accessed in the middle and developed along strike, at both the top and bottom elevations. Once sill development is completed, the stopes are drilled and blasted. Drilling and blasting start at the end of the stoping blocks and mucked in retreating vertical slices.

The Casposo Mine recovers gold and silver doré which is transported to a refining facility in Brampton, Ontario, Canada for further processing into high purity gold and silver. The processing and recovery method is whole ore cyanide leaching for extraction of the precious metal from the ore counter-current decantation (CCD) and filtration for liquid-solid separation, and Merrill-Crowe for recovery of the metal from the leach solution.

The Casposo processing plant has a nameplate throughput of 400,000 tonnes per year (tpa) of ore. At 8,000 working hours per annum, this is equivalent to 50 tonnes per hour. The current underground mine plan delivers only approximately 300,000 tpa of ore, however, Austral plans to operate the plant on an intermittent basis to retain the same plant throughput.

CRUSHING CIRCUIT
The crushing plant is designed to operate at a feed rate of up to 110 tph in order to account for lower plant utilization and availability, which is standar ........