Rare earth element (REE) and rare earth metal deposits can be divided into two main classifications: primary magmatic REE deposits and secondary REE deposits. The vast majority of deposits are primary magmatic and many of the secondary ones are proximal to REE-enriched primary magmatic sources. Most magmatic deposits are related to mantle-derived magmas and/or magmatism associated with crustal rifting. Metamorphic equivalents of these main categories are also known but not distinguished in this classification.

Primary magmatic deposits can be subdivided into peralkaline oversaturated, peralkaline undersaturated, and carbonatite deposits. Peralkaline deposits, both oversaturated (quartz-bearing or quartz normative) and undersaturated (nepheline-bearing or nepheline normative) are mainly HREE- enriched, while carbonatite deposits are commonly LREE-enriched; some carbonatite high-level vein systems are also HREE-enriched. Peralkaline rocks and carbonatites are known to occur in similar geological settings and can be spatially related.

Primary magmatic REE deposits are formed by concentration of REE and other incompatible elements (e.g., Zr, Nb, fluorine (F), U, Th, hafnium (Hf)) in the upper portions of magma chambers. These incompatible element-enriched magmas are either crystallized in place, are transported to locations proximal to the magma chamber, or are transported to surface and deposited as volcanic products.

Peralkaline oversaturated volcanic-hosted deposits are rare but known to occur (e.g., Foxtrot, Deep Fox; Brockman, Australia).

Deep Fox and Foxtrot occur in the 64 km long FHVB, which ranges in width from less than 50 m in the northwest to three kilometres in the east. Units dip steeply in a northerly direction and generally strike westerly to northwesterly, parallel to bounding faults to the north and south. The FHVB contains one peralkaline belt in the northwest and three peralkaline belts in the east, these belts of bimodal rocks dominated by REE-bearing felsic peralkaline flows and ash-flow tuffs and mafic to ultramafic volcanic and related subvolcanic units.

The three bimodal belts in the FHVB, from north to south: the Road Belt (RB), the Magnetite Belt (MTB) and South Belt (SB), have been the focus of REE exploration.

Deep Fox is hosted in the RB. In the Project area, the RB consists of, from north to south: 1) northern comendite, 2) anorthositic suite rocks consisting of anorthositic gabbro and anorthosite, 3) nonperalkaline rhyolite, 4) southern comendite, 5) mafic and ultramafic volcanic rocks, 6) mineralized pantellerite with interbedded non-peralkaline rhyolite and mafic volcanic rocks, and 7) a footwall nonperalkaline rhyolitic ash-flow tuff. Minor units of locally derived volcanogenic sediments, mafic volcanic flows, and related subvolcanic units and pegmatites occur throughout this sequence. Mineralized units are commonly interbedded with mafic to ultramafic volcanic units, quartzite, and locally derived volcanogenic sediments. Most units generally dip 75° to 85° northerly and drill data indicates that the mineralized zone plunges towards the northeast. The anorthositic suite and mineralized units form a prominent east-west trending ridge in the area. At Deep Fox the pantellerite mineralization is up to 42 m in thickness and typically averages 15m to 30 m in thickness.

Foxtrot is hosted in the MTB. In the Project area, the MTB consists of pantellerite, comendite, nonperalkaline rhyolite, and mafic to ultramafic volcanic and related subvolcanic units. Mineralized units commonly range from five metres to 20 m in thickness. Mineralization is up to 100 m in thickness (comendites plus pantellerites) at Foxtrot, medium to high grade mineralization (pantellerite) is up to 25 m in thickness and typically averages 10 m to 14 m in thickness.

Mining is proposed to be carried out at Deep Fox and Foxtrot using a combination of open pit and underground methods. Mining will first take place at Deep Fox using open pit and underground methods over a period of approximately 11 years. Open pit operations at Foxtrot will commence in the last two years of the Deep Fox underground operation. Once mining is completed at Deep Fox, mining will transition completely to Foxtrot to extend the mine life an additional 15 years (six years open pit and nine years underground) for an overall mine life of approximately 26 years.

Open Pit Mining.
The open pit mining production rate is assumed to be 720,000 tpa, or 2,000 tpd, of REE bearing material. For the purposes of this Technical Report, it is assumed that mining would be carried out year-round, however, given the relatively low production rate, there is the possibility of carrying out mining over a condensed period (six months) to avoid harsher conditions during the winter season.

Run of mine (ROM) mineralized material will be placed in a stockpile adjacent to the Primary Production Plant located near Deep Fox. ROM material will be fed to the concentrator using a front-end loader (FEL).

Mining will be carried out by a contractor using conventional truck and shovel open pit methods consisting of the following activities:
• Drilling performed by conventional production drills.
• Blasting using ammonium nitrate fuel oil (ANFO) and a down-hole delay initiation system.
• Loading and hauling operations performed with hydraulic shovel, FEL, and rigid frame haulage trucks.

The production equipment will be supported by bulldozers, graders, and water trucks. Search Minerals will supervise the overall mining operation with its own employees including mining engineers, geologists, surveyors, and support staff.

Life of Mine Plan
The life of mine (LOM) plan envisages mining Deep Fox open pit, Deep Fox underground, Foxtrot open pit, and Foxtrot underground sequentially. The production transition from open pit to underground is scheduled for Year 7 and Year 18 for Deep Fox and Foxtrot, respectively.

The schedule assumes mining in stages within Deep Fox and to the full pit outline line bench by bench in Foxtrot. Mining in the succeeding stage within Deep Fox is scheduled only after over 90% of material in the preceding stage has been depleted. Access to succeeding stages is accommodated through the ramp access design where pre-schedule stripping is required. The minimum mining distance of 75 m for each pushback is designed to maintain productivity with two 374F L production excavators and seven 745 haul trucks.

Approximately 5.0 Mt of waste is planned to be stripped in the Foxtrot open pit during year 10 while Deep Fox underground production concludes. This brings down the strip ratio for year 11 by approximately 40% as the concentrator feed shifts to Foxtrot open pit reliance.

Construction on the portal and decline to access the Deep Fox underground mine will start mid Year 7 and mineral production is planned to start by Q2 of Year 8. The portal will be located on bench -50 m of the Deep Fox open pit mine. The Foxtrot underground mine portal and development will be constructed starting in Q3 of Year 17 and mineral production will begin in Q3 of Year 18. The portal will be located on Bench -60 m of the open pit mine.

The open pit will be mined using a local mining contractor that will supply its own equipment.

Access Roads
Mineralized material will be hauled out of Deep Fox and Foxtrot using off-highway equipment. Material deemed as waste rock will be hauled to the appropriate WSF, located either east of the Deep Fox pit or west of the Foxtrot pit. Mineralized material will be hauled to stockpile locations south-west of the Deep Fox pit or north-west of the Foxtrot pit. The mineralized material from the mine stockpiles will be delivered to the ROM stockpile that is adjacent to the plant within the Deep Fox site layout. Access road construction will be 7.2 km in length, providing access to highway 513 for both deposits and direct access to the port from Deep Fox. The road width is designed to 15 m, providing operating space for both haul trucks and transport trucks.

Underground Mining.
Transverse longhole stopes will be mined using primary and secondary stopes and mining will progress from the lowest level of each mining panel and progress in a bottom-up fashion. Each mining panel consists of three to four stoping levels. Primary stopes will be mined first, starting from the bottom level and progressing vertically to the top. Once a vertical column of primary stopes has been mined the secondary stopes on either side will be mined. Transverse longhole mining allows for greater flexibility with the number of stopes that can be mined at any given time.

Longitudinal longhole stopes will be mined using a drive on each sublevel driven along the strike of the orebody. Mining will progress in a bottom-up sequence where stopes on the first level of each mining panel will be mined first before progressing to the next level.

A crown pillar of 25 m in height will be left under the bottom of the pit, which can be recovered by drilling upward from the first level of mining at the end of the LOM.

Cemented rock fill (CRF) and unconsolidated rock fill (URF) will be used to satisfy backfill requirements at Deep Fox and Foxtrot. CRF with a binder content of 6% will be used in all stopes on the first level of each mining panel so as to provide a competent back for stopes on the level below. CRF will be placed in transverse primary stopes and every 20 m for longitudinal stopes. The remaining secondary and longitudinal stopes will be filled with URF. The rock fill will come from both underground development waste and open pit waste material.

Ramp and lateral development will be undertaken using twin boom hydraulic jumbos and mechanical bolters for installation of ground support. Vertical development such as ventilation raises will be developed with Alimaks.

Stope production drilling will be carried out using longhole top hammer drills and slot raises will be drilled using V-30 ITH drills. Loading and hauling operations will be performed with load-haul-dump (LHD) units and underground trucks for waste and mineral material up to surface. Stopes will be backfilled using waste material from both underground and open pit operations and will be trucked to the appropriate locations.

Underground mining operations have been envisaged for mineralization not captured by open pit mining for both Deep Fox and Foxtrot. The production rate for the underground mines is assumed to be 720,000 tpa, or 2,000 tpd, of REE bearing material and will operate year-round. The underground mines will be owner operated.

The underground access portals for both mines will be located within the open pits. Ramps will be driven at a gradient of 15%. Level accesses will be driven from the ramps, approximately in the middle of the level, and will accommodate truck loading stations and ventilation drifts. Footwall drifts will be driven on either side of the level access and extend to the ends of the mineralized zone. Drawpoints will be driven from the footwall drifts to the stopes for mucking. Where mining progresses below a mined out level, once the stopes are completely mined out and backfilled, transverse accesses will be driven from the same footwall drifts downwards for drilling off stopes on the lower level.

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Mineralized material from Deep Fox and Foxtrot will be processed through a beneficiation system using physical means followed by hydrometallurgical processing to form a marketable precipitate of mixed REE carbonate. The beneficiation operation will take place in a plant constructed near the deposits in Labrador – the Primary Production Plant. Mineral concentrates will be transported to a plant at a brownfield site on the island of Newfoundland located close to a source of reagents and power for hydrometallurgical processing. As previously mentioned, the exact location of the Hydrometallurgical Processing Plant has not yet been selected.

Primary Production Plant
REE concentrate will be produced by a two-stage magnetic separation process. A Low Intensity Magnetic Separation (LIMS) rougher-cleaner circuit will first remove magnetite and maghemite from the mineral to produce an intermediate ferromagnetic concentrate which may have the potential for resale (not currently con ........