The DSO deposits were derived from the iron-bearing sediments of the Sokoman Formation and Ruth Formation. The ores, comprising blue and red hematite with goethite and limonite, were formed by the leaching of the gangue minerals such as chert, silicates and carbonates. Of the 22 different deposits that constitute the Project, ten selected deposits were drilled in 2008 and 2009. Drilling yielded 64.1 million tonnes of proven and probable reserves. There are 11.75 million tonnes of inferred resources remaining. In addition, about 40 million tonnes of historical resources will be drilled to expand the resource base.

The mining method selected for the DSO Project is conventional open-pit mining with a front-end loader/truck operation. The rock will be drilled, blasted and loaded into haul trucks that will deliver ROM ore to the primary mineral sizer, located at the Timmins Site. From each pit, waste will be hauled to an out-of-pit waste dump to be located nearby. Overburden removal and ore and waste mining operations will take place 24 hours per day, 365 days per year but, for loader and truck calculation purposes, it was assumed that inclement weather will shut down operations for an average of five days per year.

The run-of-mine ore processing consists of crushing and wet screening to reduce the ore to - 6 mm size. Gravity separation methods, employing jigs, spirals and hydro-classifiers, are utilized to upgrade coarse fractions. Materials below 0.1 mm are separated by wet high intensity magnetic separators (“WHIMS”).

The plant will process 5.0 million natural tonnes per year (“mtpy”) to produce 4.0 million dry tonnes of sinter fines and super fines. About 80% of the production will be the highervalued sinter fines. Various tests performed on representative bulk samples at laboratories and facilities operated by experienced technology providers demonstrated the processing ability to meet product quality requirements.