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Coricancha Mine Complex


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The Coricancha Mine Complex is located in the Province of Huarochirí, Lima region, in the central Andes of Peru. It is approximately 90 km east of Lima, by the Central National Highway connecting Lima to La Oroya. The travel time by road from Lima is approximately two hours to the processing plant and lower level of the mine. The operation is located in an area of significant relief, and elevations at the property range between 3,000 and 3,920m above sea level.

The property includes 126 mining licences, a 600 tonne per day processing permit and a transportation permit, all valid and in good standing in favour of Nyrstar and covering in excess of 3,700ha in aggregate. Mining activities in the area have been almost continuous since colonial times and formally since 1906. The current operation was substantially developed by Minera Lizandro Proaño, which owned the mine (then called “Tamboraque”) from 1955 to 2000. In the late 1990s, Minera Lizandro Proaño installed a BIOX® facility for refractory gold extraction and expanded the mining and processing capacity to the current level.

In 2000, Coricancha’s assets were acquired by Wiese Sudameris Leasing S.A. and subsequently, in 2006, Gold Hawk acquired Coricancha and achieved operating capacity. In May 2008, a landslide above the tailings dam washed some tailings into the Rimac River and the operation was suspended by the Government pending clean-up. Following Nyrstar’s acquisition of Coricancha in 2009/10, the operating suspension was lifted by the Government and Nyrstar recommenced operations.

Coricancha is a Cordilleran polymetallic ore deposit, comprising a system of massive sulphide veins and replacement bodies formed at epithermal to mesothermal conditions. The regional geology comprises a package of andesitic volcanic rocks and sedimentary rocks intruded by monzonite stocks. The area has been exposed to extreme structural compression, which has produced a strong fracturing pattern on a regional scale and allowed the intrusion of polymetallic mineralization in the form of quartz-galena-sphalerite-chalcopyrite veins with gold and silver.

The property is underlain by a sequence of the andesitic volcanics of the Rimac Formation consisting of brecciated volcanics at the bottom of the stratigraphic sequence topped by andesitic flows, agglomerate, and tuff located in the upper part of the Huamanjune Mountain at 4,500m elevation. The vein system can be described as an anastomosing system where most of the secondary and tertiary veins branch off either from a main vein or secondary veins. At the local structural level, the veins are extensive and are known to extend more than 3,800m along strike and more than 1,500m down dip. The veins show pinch-and-swell type behaviour with a thickness of up to 2m and averaging 65-70cm.

The Coricancha Mine Complex contains a historical Mineral Reserve and Resource Estimate (see table below) comprising a Proven and Probable Reserve of 0.64 million tonnes at a grade of 4.35 grams per tonne (g/t) gold, 149.12g/t silver, 0.32% copper, 1.77% lead and 2.60% zinc; a Measured and Indicated Resource of 0.89 million tonnes at a grade of 5.04g/t gold, 174.62g/t silver, 0.42% copper, 1.97% lead and 3.11% zinc; and an Inferred Resource of 4.88 million tonnes at a grade of 4.91g/t gold, 224.54g/t silver, 0.48% copper, 1.57% lead and 2.98% zinc. This represents 13.5 million silver equivalent ounces (Ag eq oz) in Proven and Probable Reserves, 21.96 million Ag eq oz in Measured and Indicated Resources and 124.6 million Ag eq oz in Inferred Resources.

The most recently published Nyrstar Mineral Reserve and Resource Estimate for the Coricancha Mine Complex has an effective date of December 31, 2012 (see Nyrstar news release February 7, 2013 and table below). Great Panther considers this estimate as historical in nature and the reader is cautioned regarding the validity of the estimate due to the facts that 1) mining continued for 6 months after the effective date of the estimate, and 2) precious metal price assumptions used in the Nyrstar estimate were higher than current prices. Work planned by Great Panther to verify the historical estimate will include surface and underground drilling and sampling. The qualified person for Great Panther has not done sufficient work to classify the historical estimate as current mineral resources or mineral reserves, and Great Panther is not treating the historical estimate as current mineral resources or mineral reserves.

Historical Mineral Reserves (December 31, 2012)*

 

Category

Tonnes (M)

Au g/t

Ag g/t

Cu %

Pb %

Zn %

Ag eq oz (M)

Proven

0.48

4.28

142.66

0.29

1.83

2.43

9.83

Probable

0.16

4.55

167.84

0.42

1.58

3.12

3.66

Total P&P

0.64

4.35

149.12

0.32

1.77

2.60

13.50

 

Historical Mineral Resources (December 31, 2012)*

 

Category

Tonnes (M)

Au g/t

Ag g/t

Cu %

Pb %

Zn %

Ag eq oz (M)

Measured

0.63

5.18

169.85

0.38

2.10

2.97

15.56

Indicated

0.26

4.72

186.07

0.54

1.66

3.45

6.43

Total M&I

0.89

5.04

174.62

0.42

1.97

3.11

21.96

Inferred

4.88

4.91

224.54

0.48

1.57

2.98

124.60

* see Nyrstar news release February 7, 2013.

 

Notes:

1.        Mineral resources are reported inclusive of mineral reserves.

2.        Historical Estimates prepared for Nyrstar by TetraTech without technical report.

3.        Metal Price assumptions (all in USD):  $1,300/oz gold, $22/oz silver, $6,300/tonne copper, $2,250/tonne lead and zinc.

4.        Values are rounded and may not add up exactly.  ‘M’ indicates ‘millions’.

5.        The Coricancha mineral resources were estimated utilising software that incorporates vein width, length and height to estimate tonnes and assay data to estimate grade.  The ore reserves were determined by the amount of directly measured information available within a block and economic viability according to metal prices and operating parameters valid at the time of the estimate.  Dilution was applied to a mineral resource when the vein width was less than the projected minimum mining width, with over-dilution applied to an ore reserve according to estimated overbreak during extraction.  It is not known to Great Panther what cut-off grades were used in this estimation.  The 2012 mineral resource and ore reserve statement for Coricancha, with a December 31, 2012 cut-off date, was completed by TetraTech in accordance with the JORC Code (Joint Ore Reserves Committee of the Australasian Institute of Mining and Metallurgy, Australian Institute of Geoscientists and Minerals Council of Australia).

6.        Silver equivalent ounces were estimated by Great Panther using the Historical Mineral Reserve and Resource Estimates.  They are a guide to metal content only.


Under the ownership of Gold Hawk, approximately 30 active stopes were required to achieve production of 600tpd, almost all using the cut-and-fill or shrinkage mining method. The principal stoping method for the near-vertical veins was overhand cut-and-fill, with backfill mainly obtained from development waste. Under Nyrstar’s ownership, other mining methods such as longhole were tried without success. Mining was semi-mechanized with ore haulage principally undertaken by locomotives, and scoops used for short distance haulage. Some drilling was undertaken with an electro-hydraulic drill jumbo, but development and production drilling were principally accomplished with hand-held jackleg drills.

The crusher and mill are located at the mine portal (3140m above sea level). The concentrator, flotation circuit and BIOX® facility are located at a lower elevation, along the main highway near the Rimac River. The concentrator produces zinc, lead and copper concentrates, and a gold-rich flotation concentrate which is treated in the BIOX® facility, ultimately resulting in the production of a Au-Ag doré. At a processing rate of 600tpd, average annual production would be approximately 21,000 oz Au, 1.0 million oz Ag, 4,400t Zn, 2,100t Pb and 400t Cu. Tailings from the processing plant are hauled by rail and/or trucks to the Chinchán dry-stack tailings storage facility, approximately 40km from Coricancha.

1.71 -0.03 -1.72% Volume: 162,907 May 19, 2017
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