The Rodeo property hosts gold- and silver-bearing mineralization with metallogenic characteristics commonly associated with a low-sulphidation (adularia-sericite) epithermal mineralizing system. Epithermal or high-level hydrothermal systems are defined to occur from depths of less than 2 km to surficial hot spring settings hosted by a variety of geological environments but usually by Tertiary-age volcanic rocks associated with subduction zones at plate boundaries.

The Rodeo property is situated in the highly productive central Mexican silver belt on the same regional structural feature that extends northwesterly to the gold-silver (± Pb, Zn) districts of Inde and Magistral del.

The Rodeo deposit belongs to the epithermal Low Sulfidation (Quartz Adularia) type. The hydrothermal system was emplaced along major faults and various veins developed along several parallel structures in the hanging wall of the Rodeo Fault but at the Rodeo deposit very little mineralization is hosted in or centered on the Rodeo Fault itself. As the most significant structure locally, it is likely that the Rodeo Fault played a role as a pathway at depth for the Rodeo deposit.

Quartz veins up to 15 meters or more in width displaying classical epithermal textures such as complex banding, bladed calcite replacement and several stages of vein injection and brecciation have been encountered in several holes throughout the property however high-grade Au mineralization appears to be limited to a distinct veining event, ancillary events both pre and postdating the high-grade event carry low-grade to anomalous levels of Au mineralization that could play an important role in evaluating the deposit for bulk tonnage potential.

The strategy for mining the resource is to access the higher-grade areas as quickly as possible and to complete the excavation of the entire resource with three phases (pushbacks). The mining of the first pushback will commence at the 1450 Bench working upwards to the 1470 Bench and downwards to the 1440 Bench simultaneously. Starting at the 1450 Bench will enable the operation to quickly access the better gold grades that exist in the 1445 and 1440 Benches.

A comparison study to determine the most favorable bench height for the project was completed by calculating and reviewing bench heights that ranged from 2.5 meters to 5.0 meters. A 5.0-meter bench height was selected due to the economics and mining ease associated with this height. It is assumed that the final pit wall’s slope is 45 degrees, however the walls may be able to be steepened due to the competency of the rock strata. The explosives and timing are designed to attain a high pile (minimal scatter), wall control, best possible fragmentation, minimal air blast, no fly-rock, and less than the legal limit of vibration. Drilling will be completed using either air or hydraulic track mounted drill units.

The Rodeo surface mine will be excavated and transported utilizing contractors. A civil or mining contractor will be used for the exaction of the mine material. The Confederation of Mexican Workers (Confederacion de Trabajadores de Mexico (CTM)) will supply trucks used for the transportation of material away from the mine.

The drilling and blasting of the mine material will be completed using the mining contractor. Golden Minerals will purchase the explosives used to ensure the correct explosive components are maintained, and Golden Minerals will supervise the loading of the shot (the contractor’s labor will perform the physical work). The excavation will be completed using 1-LCM class excavators that are loading typical 15-tonne highway rated haulage trucks. The highway trucks will either deliver the material to the plant in Velardeña, the established low-grade stockpile, or to the established waste dump. ROM stockpiling, if required, will be done in an area at the agitated leach plant that has been used for stockpiling in the past.

The contractor’s equipment fleet will contain a water truck, road grading unit and a D8 or D9 class bulldozer. The in-pit ramps are planned to be temporary in nature: 5-meters wide at a grade of 10 to 15 percent and constructed with nearby available material. The material used to construct the ramps is homogeneous: all ROM, all low grade, or all waste. However, the use of highway trucks in the mine demands that the mine’s continual road maintenance program is excellent.

Golden Minerals’ agitated leach plant in Velardeña, Durango, is approximately 115 km from the Rodeo Project and has a design capacity of 550-tpd of oxide mineral. The plant is currently operating, as of the writing of this report, with feed from Hecla Mining Company’s San Sebastian project at approximately 400 tpd. The plant is in excellent operating condition and the author last visited the plant in July of 2019. The tailing pond was recently expanded and should have adequate capacity for the tailing generated by the Rodeo Project.

ROM material is received from the Rodeo Project by truck and unloaded in an area near the Plant II coarse ore bin. The ROM material is reclaimed by a front-end loader and fed onto a 12” passing grizzly over a bin that feeds an apron feeder that controls the material flow to a jaw crusher for primary crushing. The primary crushed material is sized by a vibrating screen operating in closed-circuit with a secondary standard cone crusher. The crushed ........