REP R0001 00 FS DonNicolasGoldProject

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Report to:

Technical ReportDon Nicols Gold ProjectSanta Cruz, Argentina

Document No. 705-1196070100-REP-R0001-00


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Report to:

TECHNICAL REPORTDON NICOLS GOLD PROJECT

SANTA CRUZ, ARGENTINA

EFFECTIVE DATE: FEBRUARY 14,2012

Prepared by Callum Grant, P.Eng.Hassan Ghaffari, P.Eng.

Andr de Ruijter, Pr.Eng. (RSA), P.Eng.Doug Corley, MAIG, R.P. Geo. (Australia)Carlos Guzmn, Registered Member Chilean Mining Commission

Alistair Cadden, C.Eng. (UK)Anthony Sanford, Pr.Sci.Nat. (South Africa)Steven Osterberg, P.Geo. (USA)

CG/cl

Suite 800, 555 West Hastings Street, Vancouver, British Columbia V6B 1M1, CanadaPhone: 604.408.3788 Fax: 604.408.3722


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REVISION HISTORY

REV.NO ISSUE DATE

PREPARED BYAND DATE

REVIEWED BYAND DATE

APPROVED BYAND DATE DESCRIPTI

0 February 14, 2012 All QPs Hassan Ghaffari Hassan Ghaffari Final to Cli


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NOTICE

This report was prepared as a National Instrument 43-101 Technical Report forMinera IRL Limited (MIRL) and its subsidiary Minera IRL Patagonia S.A. (MIRLP) byWardrop, a Tetra Tech Company (Tetra Tech), Coffey Mining Limited (CoffeyMining), NCL Ingenier y Construccin Limitada (NCL), Golder Associates Argentina(Golder), and Ausenco Vector (Argentina).The quality of information, conclusions,and estimates contained herein is consistent with the level of effort involved in TetraTechs, Coffey Minings, NCLs, Golders, and Ausenco Vectors services, based on:(i) information available at the time of preparation, (ii) data supplied by outsidesources, and (iii) the assumptions, conditions, and qualifications set forth in thisreport. This report is intended for use subject to the terms and conditions of MIRL orMIRLPs contract with Tetra Tech, Coffey Mining, NCL, Golder, and Ausenco Vector.

This contract permits MIRL to file this report as a Technical Report with CanadianSecurities Regulatory Authorities pursuant to National Instrument 43-101, Standardsof Disclosure for Mineral Projects. Except for the purposes legislated under provincialsecurities laws, any other use of this report by any third party is at that partys solerisk.


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TABLE OF CONTENTS

NOTICE ............................................................................................................................................. I1.0 SUMMARY .......................................................................................................................... 12.0 INTRODUCTION ................................................................................................................. 5

2.1 BACKGROUND....................................................................................................................... 52.2 SCOPE OFWORK.................................................................................................................. 62.3 ROLES ANDRESPONSIBILITIES............................................................................................... 6

3.0 RELIANCE ON OTHER EXPERTS ..................................................................................... 94.0 PROPERTY DESCRIPTION AND LOCATION ................................................................. 10

4.1

LOCATION........................................................................................................................... 10

4.2 MINERALTENURE............................................................................................................... 114.3 ROYALTIES,RIGHTS ANDENCUMBRANCES........................................................................... 14

5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE ANDPHYSIOGRAPHY .............................................................................................................. 155.1 TOPOGRAPHY,VEGETATION ANDLANDUSE......................................................................... 155.2 CLIMATE............................................................................................................................. 155.3 ACCESS.............................................................................................................................. 165.4 INFRASTRUCTURE ANDSERVICES........................................................................................ 17

6.0 HISTORY ........................................................................................................................... 186.1 HISTORICALBACKGROUND.................................................................................................. 186.2 HISTORICALRESOURCES.................................................................................................... 19

7.0 GEOLOGICAL SETTING AND MINERALIZATION .......................................................... 207.1 REGIONALSETTING............................................................................................................. 207.2 PROJECTGEOLOGY............................................................................................................ 207.3 MINERALIZATION................................................................................................................. 21

8.0 DEPOSIT TYPES .............................................................................................................. 229.0 EXPLORATION ................................................................................................................. 24

9.1 EARLYEXPLORATION.......................................................................................................... 249.2 MIRLEXPLORATION ........................................................................................................... 24

10.0 DRILLING .......................................................................................................................... 2610.1 INTRODUCTION................................................................................................................... 2610.2 DRILLINGHISTORY.............................................................................................................. 26

11.0 SAMPLE PREPARATION, ANALYSES, AND SECURITY ............................................... 3111.1 TRENCHING........................................................................................................................ 31


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11.2 DRILLING ANDSAMPLEQUALITY.......................................................................................... 3111.2.1 RCDRILLINGNEWCREST................................................................................ 3111.2.2 RCDRILLINGYAMANA..................................................................................... 3111.2.3 DDHDRILLING-YAMANA................................................................................... 3211.2.4 DDHDRILLINGRYSA,HIDEFIELD ANDMIRL ................................................... 3311.2.5 RCDRILLINGMIRL ......................................................................................... 33

11.3 SAMPLERECOVERY............................................................................................................ 3411.4 SAMPLESECURITY.............................................................................................................. 3411.5 ANALYTICAL LABORATORIES................................................................................................ 3511.6 SAMPLEPREPARATION ANDANALYTICALPROCEDURE ......................................................... 35

11.6.1 SGSLABORATORIES(BEMAPOLIMET) ............................................................... 3511.6.2 ACMEANALYTICALLABORATORIES.................................................................... 3611.6.3 ALSCHEMEXARGENTINA.................................................................................. 36

11.7 ANALYTICALQUALITYCONTROLPROCEDURES .................................................................... 3711.8 STANDARDS ANDBLANKS.................................................................................................... 3711.9

LABORATORY

DUPLICATES AND

STANDARDS

........................................................................ 38

11.9.1 SGSANDACME ............................................................................................... 3811.9.2 ALSCHEMEX .................................................................................................... 38

11.10 UMPIRECHECKASSAYS...................................................................................................... 3911.10.1 SGSANDACME ............................................................................................... 3911.10.2 ALSCHEMEX .................................................................................................... 39

11.11 FIELDDUPLICATES.............................................................................................................. 3911.11.1 SGSANDACME ............................................................................................... 3911.11.2 ALSCHEMEX .................................................................................................... 39

11.12 SUMMARY OFQUALITYCONTROLDATA............................................................................... 4011.13 BULKDENSITYDETERMINATION .......................................................................................... 4011.14

ADEQUATE OFPROCEDURES............................................................................................... 42

12.0 DATA VERIFICATION ...................................................................................................... 43

12.1 DRILLHOLETWINNING......................................................................................................... 4313.0 MINERAL PROCESSING AND METALLURGICAL TESTING ......................................... 44

13.1 INTRODUCTION................................................................................................................... 4413.2 HISTORICALTESTPROGRAMS............................................................................................. 4413.3 MINERALOGY...................................................................................................................... 44

13.3.1 OXIDESAMPLEMINERALOGY............................................................................. 4513.3.2 SULPHIDESAMPLEMINERALOGY........................................................................ 45

13.4 HEADGRADEANALYSES..................................................................................................... 4513.5 COMMINUTIONTESTWORK .................................................................................................. 48

13.5.1 UNCONFINEDCOMPRESSIVE STRENGTHTESTREPORTNO.A10681 ................ 4813.5.2 CRUSHINGWORKINDEX-TESTREPORTNO.A10681 ....................................... 4913.5.3 BONDMILLWORKINDEXTESTS ANDABRASIONINDEXTEST............................... 49

13.6 LEACHTESTING.................................................................................................................. 5013.6.1 GRAVITYCONCENTRATIONMETHODOLOGY ........................................................ 5013.6.2 LEACHINGMETHODOLOGY................................................................................. 51


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13.6.3 GRAVITYCONCENTRATIONRESULTS.................................................................. 5113.6.4 GRAVITYCONCENTRATION ANDTAILINGSLEACHTESTS VSWHOLEORE

LEACHING.......................................................................................................... 5213.6.5 GRAVITYCONCENTRATION ANDTAILINGSLEACHTESTS...................................... 5313.6.6 COARSEORELEACHTESTS............................................................................... 56

13.7 SULPHIDESAMPLECIPTESTS(CARBONKINETICS).............................................................. 5713.8 SULPHIDESAMPLEFLOTATION ANDFLOTATIONTAILINGSLEACHTESTS ............................... 5913.9 DIAGNOSTICLEACHTEST.................................................................................................... 6013.10 SETTLINGTESTS ANDFILTRATION....................................................................................... 60

13.10.1 OUTOTEC(THICKENINGTESTWORK) ................................................................... 6113.11 CYANIDEDETOXIFICATION................................................................................................... 62

14.0 MINERAL RESOURCE ESTIMATES ................................................................................ 6514.1 INTRODUCTION ANDLOCATION OFRESOURCES.................................................................... 6514.2 BASIS OF THEMINERALRESOURCEESTIMATES................................................................... 6514.3 SULFURODEPOSIT.............................................................................................................. 66

14.3.1 MINERALRESOURCEDATABASE ANDVALIDATION............................................... 6614.3.2 GEOLOGICALMODELLINGPROCEDURE............................................................... 6614.3.3 GEOLOGICAL INTERPRETATION........................................................................... 6714.3.4 STATISTICALANALYSIS...................................................................................... 6714.3.5 BULKDENSITY DATA.......................................................................................... 6814.3.6 VARIOGRAPHY................................................................................................... 6914.3.7 BLOCKMODEL................................................................................................... 6914.3.8 GRADEESTIMATION ANDVALIDATION................................................................. 69

14.4 ARCOIRISDEPOSIT ............................................................................................................ 7014.4.1 MINERALRESOURCEDATABASE ANDVALIDATION............................................... 7014.4.2 GEOLOGICALMODELLINGPROCEDURE............................................................... 7014.4.3 MINERALIZATIONINTERPRETATION..................................................................... 7014.4.4 STATISTICALANALYSIS...................................................................................... 7014.4.5 BULKDENSITY DATA.......................................................................................... 7114.4.6 VARIOGRAPHY................................................................................................... 7114.4.7 BLOCKMODEL................................................................................................... 7114.4.8 GRADEESTIMATION ANDVALIDATION................................................................. 72

14.5 MARTINETASCENTRALAREA............................................................................................... 7214.5.1 MINERALRESOURCEDATABASE ANDVALIDATION............................................... 7214.5.2 GEOLOGICALMODELLINGPROCEDURE............................................................... 7214.5.3 STATISTICALANALYSIS...................................................................................... 7314.5.4 BULKDENSITY DATA.......................................................................................... 7614.5.5 VARIOGRAPHY................................................................................................... 7714.5.6

BLOCKMODEL................................................................................................... 77

14.5.7 GRADEESTIMATION........................................................................................... 7814.5.8 SELECTIVEMININGUNITS .................................................................................. 7814.5.9 ESTIMATIONPARAMETERS................................................................................. 78

14.6 ARMADILLO......................................................................................................................... 7914.6.1 MINERALRESOURCEDATABASE ANDVALIDATION............................................... 7914.6.2 GEOLOGICALMODELLINGPROCEDURES............................................................. 7914.6.3 STATISTICALANALYSIS...................................................................................... 80


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14.6.4 BULKDENSITY DATA.......................................................................................... 8114.6.5 VARIOGRAPHY................................................................................................... 8114.6.6 BLOCKMODEL................................................................................................... 8114.6.7 GRADEESTIMATION ANDVALIDATION................................................................. 81

14.7 MINERALRESOURCECLASSIFICATION................................................................................. 8214.8 MINERALRESOURCESUMMARYTABLE................................................................................ 8314.9 REASONABLEPROSPECTS FORECONOMICEXTRACTION...................................................... 85

15.0 MINERAL RESERVE ESTIMATES ................................................................................... 8615.1 MINERALRESERVESUMMARY............................................................................................. 8615.2 PITOPTIMIZATIONPARAMETERS.......................................................................................... 8815.3 CUTOFFGRADEANALYSIS .................................................................................................. 8915.4 DILUTION ANDORELOSS.................................................................................................... 9015.5 GENERALPITDESIGNPARAMETERS.................................................................................... 9015.6 GEOTECHNICALPARAMETERS............................................................................................. 9015.7 PITDESIGN ANDMININGPHASES......................................................................................... 9215.8 MINERALRESERVES ........................................................................................................... 98

16.0 MINING METHODS ......................................................................................................... 10016.1 PRODUCTIONDESIGNCRITERIA ........................................................................................ 10016.2 MINEPLAN ANDPRODUCTIONSCHEDULE.......................................................................... 10016.3 PITPHASE........................................................................................................................ 10116.4 MINEEQUIPMENTREQUIREMENTS..................................................................................... 103

16.4.1 GENERALCONSIDERATIONS............................................................................. 10316.4.2 MINEEQUIPMENTREQUIREMENTS.................................................................... 10416.4.3 MINELABOUR.................................................................................................. 105

17.0 RECOVERY METHODS .................................................................................................. 10817.1 INTRODUCTION................................................................................................................. 10817.2 SUMMARY......................................................................................................................... 10817.3 PLANTDESIGN.................................................................................................................. 111

17.3.1 MAJORDESIGNCRITERIA................................................................................. 11117.3.2 OPERATINGSCHEDULE ANDAVAILABILITY......................................................... 111

17.4 PROCESSPLANTDESCRIPTION ......................................................................................... 11217.4.1 CRUSHINGCIRCUIT.......................................................................................... 11217.4.2 GRINDINGCIRCUITOPERATION........................................................................ 11317.4.3 GRAVITYCONCENTRATION ANDCONCENTRATE TABLINGOPERATION................ 11417.4.4 CILCIRCUITCARBONCIRCUIT ...................................................................... 11517.4.5 TAILINGSTHICKENER....................................................................................... 11617.4.6 CYANIDEDETOXIFICATION ANDTAILINGSDEPOSITION....................................... 11617.4.7 CARBONCIRCUIT............................................................................................. 11717.4.8 REAGENTPREPARATION.................................................................................. 12117.4.9 WATERCIRCUIT............................................................................................... 12217.4.10 AIRSUPPLY..................................................................................................... 123

18.0 PROJECT INFRASTRUCTURE ...................................................................................... 124


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18.1 LOCATION OFPRINCIPALINFRASTRUCTURE....................................................................... 12418.2 ACCESSROADS................................................................................................................ 124

18.2.1 GEOTECHNICAL............................................................................................... 12518.3 TAILINGSSTORAGE........................................................................................................... 12618.4

POWERSUPPLY................................................................................................................ 128

18.4.1 POWERPLANT................................................................................................. 12818.4.2 POWERDISTRIBUTION ..................................................................................... 129

18.5 WATERSUPPLY................................................................................................................ 12918.5.1 GENERALCONSIDERATIONS............................................................................. 12918.5.2 HYDROGEOLOGICAL EXPLORATION................................................................... 13018.5.3 WATER FORHUMANCONSUMPTION................................................................. 13118.5.4 WASTEWATERTREATMENT............................................................................. 13218.5.5 DRAINAGE....................................................................................................... 132

18.6 WASTE ANDOREDUMPS................................................................................................... 13218.7 BUILDINGS........................................................................................................................ 13418.8

F

UELS

UPPLY,S

TORAGE ANDD

ISTRIBUTION...................................................................... 135

18.8.1 CONSUMPTION................................................................................................. 13518.8.2 FUELSTORAGE ANDQUALITY........................................................................... 13518.8.3 STORAGE ANDDISTRIBUTION........................................................................... 135

18.9 SECURITY......................................................................................................................... 13619.0 MARKET STUDIES ......................................................................................................... 137

19.1 METALPRICES.................................................................................................................. 13719.2 DORREFININGTERMS .................................................................................................... 13719.3 DORTRANSPORT............................................................................................................ 13819.4 GOLD ANDSILVERSALES.................................................................................................. 138

20.0 ENVIRONMENTAL STUDIES, PERMITTING AND SOCIAL OR COMMUNITYIMPACT ........................................................................................................................... 13920.1 ENVIRONMENTALSTUDIES ................................................................................................ 139

20.1.1 LOCATION ANDACCESSES ............................................................................... 13920.1.2 PHYSICALASPECTS......................................................................................... 14020.1.3 BIOLOGICALASPECTS...................................................................................... 14220.1.4 SOCIALASPECTS............................................................................................. 144

20.2 WASTE ANDTAILINGSDISPOSAL,SITEMONITORING, ANDWATERMANAGEMENT................ 14520.2.1 WASTE ANDTAILINGSDISPOSAL ...................................................................... 14520.2.2 SITEMONITORING............................................................................................ 14620.2.3 WATERMANAGEMENT ..................................................................................... 146

20.3 PERMITTING...................................................................................................................... 14720.4 SOCIAL ORCOMMUNITY REQUIREMENTS............................................................................ 14820.5 MINECLOSURE................................................................................................................. 148

20.5.1 CLOSURE OFTAILINGSSTORAGEFACILITY....................................................... 14920.5.2 WASTEROCKMANAGEMENTFACILITIESCLOSURE............................................ 14920.5.3 PIT.................................................................................................................. 15020.5.4 PROCESSPLANT.............................................................................................. 15020.5.5 ACCESSROAD................................................................................................. 150


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21.0 CAPITAL AND OPERATING COSTS ............................................................................. 15121.1 CAPITALCOST.................................................................................................................. 151

21.1.1 CAPITALCOSTSUMMARY................................................................................. 15121.1.2 RESPONSIBILITIES............................................................................................ 15221.1.3 BASIS OFESTIMATE......................................................................................... 15221.1.4 CURRENCY,ESTIMATEBASEDATE,FOREIGNCURRENCY ................................. 15321.1.5 ACCURACY...................................................................................................... 15321.1.6 CONTINGENCY................................................................................................. 15321.1.7 TAXES............................................................................................................. 15321.1.8 OWNERSCOST............................................................................................... 15421.1.9 EXCLUSIONS.................................................................................................... 154

21.2 OPERATINGCOSTS........................................................................................................... 15521.2.1 SUMMARY OFOPERATINGCOSTS..................................................................... 15521.2.2 RESPONSIBILITIES............................................................................................ 15521.2.3 BASIS OFESTIMATESGENERAL..................................................................... 15621.2.4 EXCLUSIONS.................................................................................................... 15621.2.5 SITEOPERATINGCOSTS BYELEMENT .............................................................. 15721.2.6 KEYELEMENTS................................................................................................ 157

22.0 ECONOMIC ANALYSIS .................................................................................................. 16022.1 INTRODUCTION................................................................................................................. 16022.2 SUMMARY OF INPUTS ANDASSUMPTIONS FORFINANCIALANALYSIS................................... 160

22.2.1 METALPRICES ................................................................................................ 16022.2.2 TREATMENT ANDREFINERYCHARGES.............................................................. 16122.2.3 TRANSPORT .................................................................................................... 16122.2.4 MINING ANDPROCESSINGSCHEDULES............................................................. 16122.2.5 OPERATINGCOSTS.......................................................................................... 16222.2.6 CAPITALCOSTS............................................................................................... 16322.2.7 CLOSURECOSTS ANDSALVAGEVALUE............................................................ 16322.2.8 INVENTORY ANDWORKINGCAPITAL ................................................................. 16422.2.9 ROYALTIES...................................................................................................... 16422.2.10 ARGENTINA TAXES........................................................................................... 164

22.3 PROJECTCASHFLOWS ANDFINANCIALRETURNS.............................................................. 16522.3.1 CASHFLOWS................................................................................................... 16522.3.2 FINANCIALRETURNS........................................................................................ 166

22.4 UNITCOST OFPRODUCTION.............................................................................................. 16722.5 FINANCIALSENSITIVITYANALYSIS...................................................................................... 168

23.0 ADJACENT PROPERTIES ............................................................................................. 17024.0 OTHER RELEVANT DATA AND INFORMATION .......................................................... 171

24.1 PROJECTIMPLEMENTATION............................................................................................... 17124.1.1 PERMITTING .................................................................................................... 17124.1.2 PROJECTSCHEDULE........................................................................................ 17124.1.3 PROJECTORGANIZATION................................................................................. 17424.1.4 PROCUREMENT................................................................................................ 17424.1.5 CONSTRUCTION............................................................................................... 17424.1.6 ENVIRONMENTAL,HEALTHSAFETY................................................................... 175


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24.2 RISKS ANDOPPORTUNITIES............................................................................................... 17524.2.1 PROJECTIMPLEMENTATIONPERIOD................................................................. 17524.2.2 COUNTRY ANDREGULATORY RISK ................................................................... 17524.2.3 CURRENCYRISK.............................................................................................. 17624.2.4 CONSTRUCTIONCOSTRISK ............................................................................. 17624.2.5 UNDERGROUNDRESOURCEOPPORTUNITY....................................................... 17624.2.6 HEAPLEACHOPPORTUNITY............................................................................. 17624.2.7 EXPLORATIONOPPORTUNITY........................................................................... 17724.2.8 POWERCOSTREDUCTIONOPPORTUNITY......................................................... 177

25.0 INTERPRETATION AND CONCLUSIONS ..................................................................... 17826.0 RECOMMENDATIONS ................................................................................................... 18027.0 REFERENCES ................................................................................................................ 18228.0 CERTIFICATE OF QUALIFIED PERSON ....................................................................... 183


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LIST OF TABLES

Table 2-1: Summary of Roles and Responsibilities .............................................................. 7Table 4-1: Location Data for the Don Nicols Project ........................................................ 10Table 4-2: MIRLP Mineral Titles ......................................................................................... 13Table 6-1: Mineral Resources, Independent Engineers, 2007 ........................................... 19Table 6-2: Mineral Resources, Runge, 2008 ...................................................................... 19Table 10-1: Historical Drilling and Trenching Summary ....................................................... 27Table 11-1: Bulk Densities - Martinetas ............................................................................... 41Table 11-2: Bulk Densities Paloma (Sulfuro) .................................................................... 41Table 12-1: Drillhole Twinning Data ..................................................................................... 43Table 13-1 Historical Test Work Programs and Reports ..................................................... 44Table 13-2 Calculated Sample Feed Grades - A10681 ....................................................... 45Table 13-3 Composite Sample Feed Grades - A10681 ...................................................... 46Table 13-4 Composite Multi-Element Analysis - A10681 .................................................... 46Table 13-5 Head Grade Multi-Element Analysis - A10830 .................................................. 46Table 13-6 Summary of ICP and Fire Assay Results, Martinetas - A13483 ........................ 47Table 13-7 Head Assay Results; Sulfuro Composite Samples - A13097-B ........................ 48Table 13-8 Head Assay Results; SD-10 Composite Sample - A13097-C ........................... 48Table 13-9 UCS Test Results ............................................................................................. 49Table 13-10 Comminution Test Results Summary ................................................................ 50Table 13-11 Gravity Concentration Test Results - A10681 ................................................... 51Table 13-12 Concentration Test Results; Sulphide Material - A12879 .................................. 51Table 13-13 GRGC Recoveries versus Grind Particle Size - A13483-B ............................... 52Table 13-14 Summary of Gravity plus Leach vs Whole Ore Leach

Test Results - A10681....................................................................................... 52Table 13-15 GRGC Recoveries vs Grind Particle Size including Gravity Tailings

Leaching - A13483-B ........................................................................................ 53Table 13-16

Summary of Gravity Tailings Leaching Tests - A12879 .................................... 53

Table 13-17 Summary of Staged Grinding and Leaching Results - A13483-B ..................... 54Table 13-18 Summary of Gravity and Cyanidation Test Results A13485-B ....................... 55Table 13-19 Chemical Analysis of Loaded Carbon Sample A13097-B .............................. 58Table 13-20 Sulphide Flotation and Tailings Leaching Test Results A13483 .................... 60Table 13-21 Diagnostic Leaching Test Results - Leach Residue,

Sulfuro Met-01 A13097 .................................................................................. 60Table 13-22 Flocculation and Settling Testwork Results A13483-A ................................... 61Table 13-23 Outotec Test Results - September 2011 ........................................................... 62Table 13-24 Cyanide Detoxification Results A13483-B ...................................................... 63Table 13-25 Summary of Detoxification Test Conditions ...................................................... 63Table 13-26 Cyanide Detoxification Results, Sulfuro Met-01 Sample A13097 ................... 64Table 13-27 Summary of Detoxification Test Conditions-Sulfuro Met-01 .............................. 64Table 14-1: Summary of Estimation Methods ...................................................................... 65Table 14-2: Cutting Levels Sulfuro (Paloma) Deposit .......................................................... 68Table 14-3: Cutting Statistics for Au (g/t) and Ag (ppm) Sulfuro Deposit .......................... 68Table 14-4: In-Situ Bulk Densities, Sulfuro Vein .................................................................. 68Table 14-5: Cutting Statistics for Au (g/t) and Ag (ppm) Arco Iris Deposit .......................... 71Table 14-6: Summary Statistics Au g/t Composite Data ................................................... 73Table 14-7: Summary Statistics Ag g/t Composite Data ................................................... 74Table 14-8: Cutting Statistics, Martinetas ............................................................................. 74


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Table 14-9: Indicator Class Means Zone 1 ....................................................................... 75Table 14-10: Indicator Class Means Zone 2 ....................................................................... 75Table 14-11: Indicator Class Means Zone 3 ....................................................................... 76Table 14-12: Bulk Densities, Martinetas ................................................................................. 76Table 14-13: Summary Cut Statistics Au g/t Composite Data ............................................. 80Table 14-14: Summary Cut Statistics Ag g/t Composite Data ............................................. 80Table 14-15: Don Nicols Measured and Indicated Mineral Resources ................................. 84Table 14-16: Don Nicols Inferred Mineral Resources ........................................................... 85Table 15-1: Mineral Reserve Summary, Don Nicols Project .............................................. 86Table 15-2: Pit Optimization Parameters ............................................................................. 88Table 15-3: Metallurgical Recovery Parameters .................................................................. 88Table 15-4: Don Nicols Pit Optimization Results ................................................................ 89Table 15-5: Don Nicols Cutoff Grades ............................................................................... 89Table 15-6 Geotechnical Domains and Occurrences by Pit ................................................ 91Table 15-7 Geotechnical Domains Properties Adopted for this Study................................. 92Table 15-8: Overall Slope Recommendations, Golder ......................................................... 92Table 15-9: Phase Mining Sequence ................................................................................... 95Table 15-10: Material Contained in Optimized Pit Shell and Ultimate Pit Design ................... 96Table 15-11: Resource by Classification inside the Ultimate Design Pit* ............................... 98Table 15-12: Dilution per Area ............................................................................................... 99Table 16-1: Summary Mine Production Plan by Year ........................................................ 101Table 16-2: Total Material Movement by Phase (kt)........................................................... 102Table 16-3: Total Yearly Ore Mining by Phase (kt) ............................................................ 102Table 16-4: Pre-Production Phase (4 months) ................................................................... 103Table 16-5: Mine Equipment Requirements by Year.......................................................... 104Table 16-6: Material Parameters for Equipment Sizing ...................................................... 105Table 16-7: Total Mine Labour per Period .......................................................................... 107Table 17-1 Major Design Criteria ...................................................................................... 111Table 18-1 Trial Pits Summary (Tailing Storage Facility (TSF); Waste Dump (WD);

Heap Leaching (HL); South Plant (SP)) .......................................................... 125Table 18-2: Initial Water Supply Well Requirements .......................................................... 131Table 18-3 Waste Dump Stability Analysis ....................................................................... 133Table 18-4: Waste Dump Capacities .................................................................................. 134Table 18-5: Stockpile Capacities, Plant and LG Material ................................................... 134Table 20-1 Environmental Impact Reports Deadlines ....................................................... 148Table 21-1: Capital Cost Summary, Life-Of Mine (LOM) .................................................... 151Table 21-2: LOM Operating Cost Summary ....................................................................... 155Table 21-3: Site Operating Costs by Element, LOM .......................................................... 157Table 21-4: Manpower Requirements, Production Year 02 ............................................... 158Table 21-5: Principal Process Consumable Consumptions ............................................... 159Table 22-1: Metal Prices .................................................................................................... 161Table 22-2: Don Nicols Mining and Processing Schedule ................................................ 162Table 22-3: Don Nicols Operating Costs .......................................................................... 162Table 22-4: Don Nicols Capital Costs .............................................................................. 163Table 22-5: Don Nicols Cash Flow ................................................................................... 166Table 22-6: Summary of Don Nicols Financial Results .................................................... 167Table 22-7: LOM Unit Cost of Production .......................................................................... 168Table 22-8: Sensitivity of Financial Returns versus Gold Price .......................................... 169Table 24-1 Low Grade Mineral Resources ........................................................................ 176Table 25-1: Don Nicols Net Present Value Estimates ...................................................... 178


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LIST OF FIGURES

Figure 4-1: Project Location Map ........................................................................................ 11Figure 4-2: Property Claim Map, Don Nicols Project ......................................................... 12Figure 5-1: Wind Rose Diagram, 2008 to 2010 ................................................................... 16Figure 10-1: Paloma (Sulfuro) Drill and Trench Plan ............................................................. 28Figure 10-2: Martinetas Central Area Drill and Trench Plan .................................................. 29Figure 10-3: Armadillo Drill and Trench Plan ......................................................................... 30Figure 13-1 Carbon Adsorption Tests .................................................................................. 57Figure 15-1: Martinetas Mining Area ..................................................................................... 87Figure 15-2: La Paloma Mining Area ..................................................................................... 87Figure 15-3: La Paloma Final Pit Design ............................................................................... 93Figure 15-4: Martinetas Final Pit ........................................................................................... 94Figure 15-5: Armadillo Pit ...................................................................................................... 95Figure 15-6: Plots of Ultimate Pit Shells Compared to Mine Designs .................................... 97Figure 16-1: Time Model Structure ...................................................................................... 104Figure 16-2: Mine Organization Chart ................................................................................. 106Figure 17-1 Simplified Process Flowsheet ......................................................................... 110Figure 18-1: Don Nicols Infrastructure ............................................................................... 124Figure 19-1: 3-Year Gold Prices .......................................................................................... 137Figure 22-1: NPV at 5% real (post-tax) Sensitivity Chart ..................................................... 168Figure 22-2: IRR real (post-tax) Sensitivity Chart ................................................................ 169Figure 24-1: Project Implementation Schedule ................................................................... 173


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GLOSSARY

UNITS OF MEASURE

Above mean sea level ...................................................................................................................... amsl

Acre ................................................................................................................................................. ac

Ampere ............................................................................................................................................ A

Annum (year) ................................................................................................................................... a

Billion ............................................................................................................................................... B

Billion tonnes .................................................................................................................................... Bt

Billion years ago ............................................................................................................................... Ga

British thermal unit ........................................................................................................................... BTU

Centimetre ....................................................................................................................................... cm

Cubic centimetre .............................................................................................................................. cm3

Cubic feet per minute ....................................................................................................................... cfm

Cubic feet per second ...................................................................................................................... ft3/sCubic foot ......................................................................................................................................... ft3

Cubic inch ........................................................................................................................................ in3

Cubic metre ...................................................................................................................................... m3

Cubic yard ........................................................................................................................................ yd3

Coefficients of Variation ................................................................................................................... CVs

Day .................................................................................................................................................. d

Days per week ................................................................................................................................. d/wk

Days per year (annum) .................................................................................................................... d/a

Dead weight tonnes ......................................................................................................................... DWT

Decibel adjusted .............................................................................................................................. dBa

Decibel ............................................................................................................................................. dBDegree .............................................................................................................................................

Degrees Celsius ............................................................................................................................... C

Diameter ..........................................................................................................................................

Dollar (American) ............................................................................................................................. US$

Dollar (Canadian) ............................................................................................................................. Cdn$

Dry metric ton ................................................................................................................................... dmt

Foot .................................................................................................................................................. ft

Gallon .............................................................................................................................................. gal

Gallons per minute (US)................................................................................................................... gpm

Gigajoule .......................................................................................................................................... GJ

Gigapascal ....................................................................................................................................... GPa

Gigawatt ........................................................................................................................................... GWGram ................................................................................................................................................ g

Grams per litre ................................................................................................................................. g/L

Grams per tonne .............................................................................................................................. g/t

Greater than ..................................................................................................................................... >

Hectare (10,000 m2) ......................................................................................................................... ha

Hertz ................................................................................................................................................ Hz


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Horsepower ...................................................................................................................................... hp

Hour ................................................................................................................................................. h

Hours per day .................................................................................................................................. h/d

Hours per week ................................................................................................................................ h/wk

Hours per year ................................................................................................................................. h/a

Inch .................................................................................................................................................. "Kilo (thousand) ................................................................................................................................. k

Kilogram ........................................................................................................................................... kg

Kilograms per cubic metre ............................................................................................................... kg/m3

Kilograms per hour ........................................................................................................................... kg/h

Kilograms per square metre ............................................................................................................. kg/m2

Kilometre .......................................................................................................................................... km

Kilometres per hour .......................................................................................................................... km/h

Kilopascal......................................................................................................................................... kPa

Kilotonne .......................................................................................................................................... kt

Kilovolt ............................................................................................................................................. kV

Kilovolt-ampere ................................................................................................................................ kVAKilovolts............................................................................................................................................ kV

Kilowatt ............................................................................................................................................ kW

Kilowatt hour .................................................................................................................................... kWh

Kilowatt hours per tonne (metric ton) ............................................................................................... kWh/t

Kilowatt hours per year .................................................................................................................... kWh/a

Less than .........................................................................................................................................

Documents

REP R0001 00 FS DonNicolasGoldProject