EL Chanate

Located 37km northeast of Caborca in Sonora, the El Chanate mine is located on a site rich in history that has been explored and mined for gold since the early 19th century. In 2011, the project was acquired by Aurico Gold and has been delivering substantial results since. During 2014, El Chanate reported production and cash cost results that were in line with guidance levels, and is set to deliver another year of solid operational performance in unity with 2015’s expected cash cost and production estimates. The mine contains an open pit heap, leach pads, a crusher, a processing plant, and is located on 3,665 hectares across 19 mineral concessions. El Chanate employs a conventional three stage crushing and heap leaching process where the gold bearing solutions are processed in an ADR plant complemented by electro-winning and refining. The open pit mine plan covers an area approximately 1,700m long, 780m wide, and 280m deep. In 2014, Aurico Gold’s exploration program focused on further defining mineralization within the existing open pit and expanding the known mineralization along the Chanate trend with of goal of increasing resources and potentially extend mine life. The drilling program within the current open pit has intersected a new type of mineralization below the ultimate open pit floor, which is significantly higher in grade than the current reserve grade and is hosted within a strongly silicified siltstone adjacent to a fault structure.

El Chanate’s most distinguishable geological feature is the Chanate fault zone, a 7km-long northwest strike that has a variable southwest dipping structure. The area is governed by deformed sedimentary rocks of the late Jurassic to early Cretaceous Bisbee Group and the late Cretaceous Chanate Group, which are locally overlain by andesites that belong to the El Charro volcanic complex. The sedimentary strata are locally intruded by dikes and andesitic sills, as well as a diorite stock and micro-porphyritic latite. These strata comprise mudstone, siltstone, sandstone, conglomerate, shale, and limestone. In surface outcrops the mineralized zone is distinguished by its bleached appearance relative to un-mineralized rock. Subparallel sheeted zones of quartz veinlets form thick, mineralized lenses, within a larger area of sub-economic but anomalous gold concentrations. Drill-hole data indicates that the mineralized lenses are sub-horizontal to gently southwest dipping, and often run parallel to the Chanate fault and the steep normal faults. The Chanate fault zone itself is generally weakly mineralized, while rock units in the adjacent hanging and footwalls are well mineralized.