The eastern Shandong (“Jiaodong”) gold district is divided from west to east into the Zhaoyuan- Yexian, Qixia, and Muping-Rushan gold belts. The Songjiagou Property is located within the MupingRushan gold belt situated in the eastern part of the Jiaobei Terrane, which contains about 20% of the gold reserves of the Shandong Peninsula. Gold mineralization is characterized as either vein-filling or as disseminated structures/stockwork.

Project area. A ductile shear zone and ductile brittle fault zone are major geological structures in the area. Major magmatic activity is represented by monzonite granite. Other veins include diabase, diorite, hornblende porphyrite, and lamprophyre.

Palaeoproterozoic metamorphic rocks of the Jingshan Group are mainly distributed to the north of the Project area near Tanjia village, and are comprised of biotite granulite, graphite-bearing gneiss, leucogranulite, and marble. These strata generally dip southeast with angles varying from 15° to 50°.

Cretaceous-age rocks are predominately represented by the Lisishan Formation, part of the Laiyang Group and comprised of conglomerate and sandstone. The Lisishan Formation in the Project area has an overall northeast strike and dips southeast with an angle of 20° to 40°. The formation is dividable into two conformably contacted sections according to the clast size. The first section of Lisishan Formation consists of relatively larger clasts with grain sizes of about 3 cm – ........

Open pit
Mining inventory is loaded by excavator and then transported to the processing plant by truck.

In order to effectively control the grade and match excavator capacities, block sizes in the resource model were set at 10 m × 10 m × 5 m. Two benches were combined into one during optimization, and the final bench heihgt is 10 m.

Underground
The Songjiagou underground mine is situated approximately 405 metres northeast of the Company’s existing open pit operation. The formed concrete portal entrance provides access to a spiral ramp whose dimensions are 4.5 × 4.0 metres at a slope gradient ranging from 10-15% with the exception of curved portions which are slopped at 5% for safety reasons.

The ramp is sized to facilitate the use of trackless mining equipment including ore haulage to the surface process plant. The ramp was collared at an elevation of 80 meters a.s.l (above sea level) and is designed to achieve a total length of 2,075 meters in the first phase of development.

Underground mining operations are highly mechanized and include high efficiency, rapid- penetrating, hydraulic jumbo drills for development work, rotary drilling equipment employing extension steel for inclined medium and longer holes, 20 tonne dump trucks for ore haulage to surface via the ramp, and electric scrapers to facilitate ore recovery and loading in work areas.

The Company employs a mix of mining methods which are based on mini ........

- subscription is required.

There are two fully operational processing plants at Songjiagou. One plant with a processing capacity of 1,200 tonnes-per-day commenced operation in 2006. Another plant with a capacity of 6,000 tonnes-per-day was put into production in May 2011, bringing the aggregate processing capacity at Songjiagou to 7,200 tonnes-per-day.

The Songjiagou processing plant includes conventional three-stage crushing within a closed circuit, grinding within a closed circuit, and flotation consisting of one stage of roughing, one stage of cleaning and two stages of scavenging.

The flotation process includes one stage of roughing, one stage of cleaning, and two stages of scavenging.

The slurry, mixed with sodium butyl xanthogenate (“SBX”) and frother (No. 2 oil) in the agitation tank, flows to the head cell of the roughing. The flotation tailings flow to the first scavenger flotation cells for further gold recovery. The rougher flotation concentrate is sent to cleaner f ........