THE GEOLOGY OF SANTA ANA, A NEWLY DISCOVERED EPITHERMAL

SILVER DEPOSIT, PUNO PROVINCE, PERU

By

Christian Ríos Vargas

___________________

A Manuscript Submitted to the Faculty of the

DEPARTMENT OF GEOSCIENCES

In Partial Fulfillment of the Requirements

For the Degree of

MASTER OF SCIENCE

In the Graduate College

THE UNIVERSITY OF ARIZONA
2008

1
 STATEMENT BY THE AUTHOR

This thesis has been submitted in partial fulfillment of requirements for the
Master of Science degree at The University of Arizona and is deposited in the Antevs
Reading Room to be made available to borrowers, as are copies of regular theses and
dissertations.

Brief quotations from this manuscript are allowable without special permission,
provided that accurate acknowledgment of the source is made. Requests for permission
for extended quotation from or reproduction of this manuscript in whole or in part may be
granted by the Department of Geosciences when the proposed use of the material is in the
interests of scholarship. In all other instances, however, permission must be obtained
from the author.

__________________________________________ _____________
(author’s signature) (date)

APPROVAL BY RESEARCH COMMITTEE

As members of the Research Committee, we recommend that this thesis be accepted as

fulfilling the research requirement for the degree of Master of Science.

Eric Seedorff
__________________________________________ _____________
Major Advisor (type name) (signature) (date)

Mark D. Barton
__________________________________________ _____________
(type name) (signature) (date)

Spencer R. Titley
__________________________________________ _____________
(type name) (signature) (date)

2
 ACKNOWLEDGMENTS

I would like to express my gratitude to Eric Seedorff, for his time, editorial

comments, and assistance in translation throughout the writing of this thesis. I would like

to thank Mark D. Barton and Spencer R. Titley for their comments and suggestions on

previous versions of the thesis.

I would like to thank Mr. David Lowell for his financial support via the Lowell

Scholarship, and Bear Creek Mining for their financial support during my stay in the

United States, and especially to Andrew Swarthout for motivating me to come here.

I would like to thank to the people that motivated me in general. Thanks to Cesar

Rios, David Volkert, and Mike McClave for their comments on the paper. I thank Greg

Corbett for the use of some of his figures and for giving me some papers before arriving

in the U.S. I thank Edwin Gutierrez for his patience in helping me understand the

MineSight Software. I thank Luis Romero for his time helping me with some figures and

maps. I thank Rene Tonconi for his help with some figures and photos. I thank Doug

Kriener and Brad Christoffersen for their help with language and grammar issues in some

parts of the paper.

My most special thanks goes to Carolina, my wife. Thank you for your

understanding, unconditional love, and never ending support.

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 DEDICATION

Dedicated to my loved ones – the people who support and believe in me.

To my wife Carolina, the most special person in my life,

To my newborn Ana Camila, the one who inspires me to be responsible and who

motivates me to work to my full potential,

To my father (El Abuelo), mother, and my sister for their love, support

and education throughout my life.

To God, the One that gave sense to my life.

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 TABLE OF CONTENTS

LIST OF ILLUSTRATIONS……………………………………………………...8

LIST OF TABLES………………………………………………………………..10

ABSTRACT……………………………………………………………………….11

INTRODUCTION………………………………………………………………...13

EXPLORATION HISTORY……………………………………………………..16

METHODS………………………………………………………………………..17

Geologic mapping………………………………………………………………..17

Rock chip sampling……………………………………………………………....17

Trenching…………………………………………………………………………18

Geophysical surveying…………………………………………………………...18

Drilling and logging……………………………………………………………...18

Petrography………………………………………………………………………19

Soil sampling……………………………………………………………………..19

Geologic modeling……………………………………………………………….19

EXPLORATION OPERATIONS……………………………………………….20

REGIONAL GEOLOGY AND TECTONICS………………………………….23

DISTRICT GEOLOGY…………………………………………………………..25

GEOLOGY OF ANOMALY B AREA OF THE SANTA ANA DEPOSIT…..27

Overview…………………………………………………………………………27

Rock types……………………………………………………………………….27

Mesoscopic characteristics……………………………………………………..27

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 TABLE OF CONTENTS-Continued

Petrography……………………………………………………………………...28

Structural geology…………………………………………………………………28

Mineralization……………………………………………………………………..29

Mode of occurrence………………………………………………………………29

Mineralogy……………………………………………………………………….30

Wall-rock alteration………………………………………………………………..32

Alteration in andesitic lava flows………………………………………………...32

Alteration in dacite dike…………………………………………………………..33

GEOLOGY OF ANOMALY A……………………………………………………34

GEOPHYSICAL CHARACTERISTICS………………………………………...35

SOIL SAMPLES…………………………………………………………………. .36

GEOLOGIC INTERPRETATIONS AND DISCUSSION………………………37

Structural interpretation…………………………………………………………...37

Parageneses………………………………………………………………………..38

Geochemical environment………………………………………………………...40

Influence about fluid sources……………………………………………………...41

Classification and distinctive characteristics of Santa Ana……………………….42

Comparison of Santa Ana with other epithermal polymetallic vein deposits…….43

Pachuca-Real del Monte…………………………………………………………43

Peripheral zones of Butte………………………………………………………...43

Laykakota………………………………………………………………………..44

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 TABLE OF CONTENTS-Continued

RESOURCE ESTIMATION……………………………………………………..45

Assembly of drilling and geologic data…………………………………………..45

Defining 3-D solid………………………………………………………………..45

Geostatistical analysis…………………………………………………………….45

Grade interpolation and resource estimation……………………………………..46

OTHER ECONOMIC IMPUTS…………………………………………………47

Infrastructure……………………………………………………………………..47

Mining……………………………………………………………………………47

Metallurgy………………………………………………………………………..47

ECONOMIC POTENTIAL………………………………………………………48

CONCLUSIONS………………………………………………………………….49

REFERENCES……………………………………………………………………51

FIGURE CAPTIONS…………………………………………………………….58

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 List of Illustrations

FIGURE 1. Location map of the Santa Ana deposit…………………………………… 63

FIGURE 2. Location map of Anomaly A and Anomaly B…………………………...… 64

FIGURE 3. Photographs of old workings ……………………………………………… 65

FIGURE 4. Geologic map of Anomaly B………………………………………………. 66

FIGURE 5. Detailed geological map of East Breccia………………………………….. 67

FIGURE 6. Photographs of trenches at Anomaly B……………..................................... 68

FIGURE 7. 3D Interpretation of induced polarization and resistivity survey………….. 69

FIGURE 8. Interpretation of 3D induced polarization and resistivity section.……….... 70

FIGURE 9. Representative photograph of drill core…………………………………… 71

FIGURE 10. Photomicrographs of lavas………………………………………….……. 72

FIGURE 11. Photomicrographs of opaque mineralogy ……………………...…………73

FIGURE 12. Location map of soil samples, Anomaly B………………………………. 74

FIGURE 13. Projection of drill holes to plan view, MineSight® Software…………… 75

FIGURE 14. Projection of drill holes to section view, MineSight® Software……….… 76

FIGURE 15. Solid shape from different views, MineSight® Software…………..….… 77

FIGURE 16. Histogram of Ag assay values…………………..…..………………….… 78

FIGURE 17. 3-D Block model, plan view……………………………………………… 79

FIGURE 18. 3-D Block model, section view……………………………………………80

FIGURE 19. Photographs of drill core…………………………….…………………… 81

FIGURE 20. Stratigraphic column, Puno. ……………………………...…..………….. 82

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FIGURE 21. Surface photographs……………………………………………………… 83

FIGURE 22. Sketch of geological relationships including dilational splays………….....84

FIGURE 23. Conceptual geological model for Santa Ana……………………………....85

FIGURE 24. Comparison of three phases of metallurgical test results……………….... 86

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 List of Tables

TABLE 1, Diagnostic Minerals and Textures of Various States of pH, Sulfidation

and Oxidation State…………………………………………………………………… 87

TABLE 2, Resource Estimate Determined with MineSight® Software……………….. 88

TABLE 3, Drill holes results, Phase 1…………………………………….…………… 89

TABLE 4, Drill holes results, Phase 2…………………………………………………. 90

TABLE 5, Drill holes results, Phase 3…………………………………………………. 91

TABLE 6, Drill holes results, Phase 3, continued…………………………………...…. 92

TABLE 7, ALS Shaker Test results………………………………………………….… 93

TABLE 8, Plenge Bottle Roll Test results…………………………………………….... 94

TABLE 9, McClelland Bottle Roll Test results……………………………………….... 95

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 Abstract

The Santa Ana project is an epithermal silver vein deposit in the Andes

discovered in 2006 by geologists of Bear Creek Mining. It comprises seven claims that

cover an area of 6,300 hectares. The main property anomaly is located 4 km south of the

village of Huacullani and about 120 km south of Puno, southeastern Perú, South

America. The mineralogy and geometry of the veins of this deposit show similarities with

certain intermediate sulfidation epithermal deposits, such as Pachuca mine in Mexico.

The characteristics of the Santa Ana deposit are known primarily from outcrop

mapping, rock chip and soil sampling, and drilling. Mineralization is hosted by andesitic

lava flows of the Oligocene to Miocene Tacaza Group and associated dacitic dikes. The

veins contain sphalerite, galena, pyrite, minor chalcopyrite, and argentite and a late

carbonate. Most silver occurs as argentite that overgrows sphalerite. The veins are

bordered by chlorite-pyrite-illite alteration envelopes of assemblages are products of from

these structures.

Mineralization is localized mainly along two trends: north-south and east-west.

Most of the mineralized veins strike north to northeast and dip 15º to 60º west. The

principal veins range in width from centimeters to 2 meters, although the total width of a

mineralized interval, including zones of stockwork veins, breccias, and open- space

filling structures can be up to 40 meters. The highest silver values occur in areas of open-

space filling that may represent dilatant flexural zones associated with variations in strike

of the veins. Fluidized breccia dikes, hydrothermal magnetite veins (at depths >170m),

11
and illite-pyrite alteration are present at Santa Ana, which some workers regard as

evidence of a magmatic fluid component.

Santa Ana has characteristics in common with other Ag-Zn-Pb polymetallic vein

deposits of southern Perú. The mineralogy of Santa Ana has similarities with Pachuca,

Hidalgo, Mexico, the outer zones of Butte, Montana, and Laykakota, Perú, but the quartz-

poor character and lack of evidence for adularia at Santa Ana are distinctive. A resource

estimate based on the first 50 drill holes, made using MineSight® software is ~48 million

tonnes containing ~40 million ounces of contained Ag at an average grade of ~30 g/t Ag

and demonstrates that Santa Ana has the potential to be a bulk-minable deposit.

Metallurgical testing indicates the potential for cyanide leaching of ores at Santa Ana,

which is economically favorable and thus strongly encourages further exploration and

possible future development of the deposit.

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 Introduction

The mineralogy, wall-rock alteration, and structure of epithermal deposits provide

key information necessary to understand their genesis (Simmons et al., 2005), and the

location, size, grade, and metallurgical characteristics of deposits are important factors

relevant to their economic viability (e.g., Hoal et al., 2006). The Santa Ana project,

located about 120 km south of Puno in the Miocene andesite-dacite arc terrane

constructed on the Altiplano in the Andes of southeastern Perú (Fig.1), is an epithermal

silver vein deposit discovered in 2006 by geologists of Bear Creek Mining with

similarities to certain intermediate sulfidation epithermal deposits. Mineralization is

structurally controlled in andesitic lava flows of the Eocene to Miocene Tacaza Group

and dacitic dikes, which are altered to chlorite-pyrite-illite assemblages. Elevations in the

area vary between 3800 and 4300 m above sea level (~14,000 ft).

Epithermal deposits, as originally defined, are products of hydrothermal activity

at shallow depths and low temperatures (Lindgren 1922, 1933). Deposition normally

takes place within about 1 km of the surface in the temperature range of <100 to 320° C.

During formation of these deposits, fluids can reach the surface as hot springs.

Epithermal deposits are more common in areas of active volcanism, including volcanic

arcs. Epithermal deposits are important hosts of precious metals but also contain other

metals, such as Cu, Pb, Zn, and Bi. Comparison of the hydrothermal evolution of major

silver veins in Tertiary volcanic rocks reveals contrasting thermal histories, sulfidation

states, and degree of hydrolysis associated with ore fluids (e.g., Tayoltita and Guanajato,

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Mexico; Graybeal et al., 1986). Vein assemblages indicate little restriction on the

availability of sulfur and other constituents. Vein temperatures for ore-grade

mineralization fall into a narrow range. In all deposits economic amounts of precious

metals are deposited at 250º - 300º C from solutions containing 10-2 to 10-3 total sulfur at

pH = 4-6 (Graybeal et al., 1986).

The Andes are a major producer of precious metals (Anonymous, 1972; Noble et

al., 1989, 1999; Noble and Vidal, 1994), and Perú is particularly known for its silver

production (Kamilli et al., 1977). Polymetallic veins in the Andes are sulfide - rich veins

containing sphalerite, galena, silver and sulfosalt minerals in a carbonate and quartz

gangue. Regional faults, fault sets, and fractures are important ore controls. The Miocene

volcanic arc in the Peruvian Andes is an important metallogenic province for precious

metal epithermal vein deposits such as Caylloma (Echavarria et al., 2006), Arcata

(Candiotti et al., 1990), Orcopampa (Gibson et al., 1990, 1995), and the recently

discovered Corani deposit. Veins largely form by several phases of open-space fillings of

faults, but some degree of wall-rock replacement, particularly in breccia fragments, is

usually present (Colqui, Perú; Kamilli et al., 1977). Veins commonly have complicated

parageneses and may exhibit spatial zoning with silver overlying base metal assemblages,

although superposition is also common.

Santa Ana is a structurally controlled, Ag-rich vein deposit with mineralogic

similarities to intermediate-sulfidation deposits (Table 1) such as Pachuca, Hidalgo,

Mexico, but the quartz-poor character and lack of evidence for adularia at Santa Ana are

distinctive. Certain characteristics may indicate proximity to an intrusion that could be a

source of metals for the deposit. The size, grade, and metallurgical properties of the ores

14
are economically favorable for possible future development of the deposit, thus

supporting further exploration of the deposit.

The purpose of this paper is to describe the geology of this new volcanic-hosted

silver-polymetallic deposit, to compare its characteristics with other epithermal deposits,

and to make a preliminary resource estimate. I first describe the geologic setting of the

region and the district that contains the Santa Ana deposit, then document the methods

that Bear Creek Mining followed to make this discovery. I summarize the results of my

field work and describe the structure and mineralogy of the deposit. I compare Santa Ana

with other silver - polymetallic deposits and offer speculations on its origin. Finally, I use

data of the first 50 drill holes to make a resource estimate of the deposit with MineSight®

software to evaluate the economic potential of the Santa Ana deposit.

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 Exploration History

The earliest work done at Santa Ana dates back to colonial times. Similar to many

of the early discoveries in Latin America, it was mined by the Spanish in the 1600’s.

Some miners returned in the earliest 1980’s, in which small workings mostly mined

narrow, structurally controlled high-grade zones.

In 2004, geologists of Bear Creek Mining Corporation became aware of these old

workings and took eight chip samples that returned values of up to 200 grams per tonne

of silver in a “crestone” structure (term used for vein-breccias with hackly texture).

Samples from rock chips returned values of 20-35 grams per tonne. Consequently, Bear

Creek decided to begin serious exploration during the second half of 2004. The areas

containing the most significant geochemical anomalies were given names designated by

letters (e.g., Anomaly A, Anomaly B, etc.). Anomaly A, Anomaly B and Anomaly C (1

km south of the main Anomaly B) (Fig. 2) contain some of the small mine workings that

were dug in the 1980’s (Fig. 3). Little is known about mining close to the Huacullani

District but “comuneros” (indigenous people who live in Huacullani, the closest village

to the project) said that people used to mine a gray colored mineral (supposed to be lead).

The focus of exploration completed to date has been on Anomaly B. Bear Creek

geologists started grid sampled (50 x 50 meters) in the Anomaly B zone, taking 446

samples that averaged 83 grams per tonne. Later, four trenches were dug totaling 160 m

in length. Three phases of drilling have been completed since then. More recently,

increasing attention has been focused on Anomalies C and A.

16
 Methods

Geologic mapping

Detailed mapping was completed at a scale of 1:2500 (meters) in 2004 (Fig. 4). A

more detailed map was made at a scale of 1:1000 for the main structural trend called

“East Breccia” because of the abundant structures present there (Fig. 5). Mapped

observations were plotted on two layers: one for structures and the other for outcrops and

alteration. Outcrops and mineralized structures where drawn in layers using Provisional

South American 1956 map datum recorded on a Garmin GPS 12.

Rock chip sampling

Sampling was done in an area of 2.8 kilometers long by 600 meters wide. A total

of 582 samples were taken in the area (“Anomaly A” and “Anomaly B” areas, see Fig.2),

with an average of 85.4 g/t silver. Samples include chip samples from outcrops and

structures. Samples were taken randomly (spaced 1.5 – 2 m) on outcrops. In the case of

structures, samples were collected continuously along a channel line perpendicular to the

structure. The footwalls and hanging walls were also considered for sampling of

structures. Each sample was described in the field; they later were recorded in an Excel

spreadsheet.

17
Trenching

Trenching was done in order to check if the silver anomalies continue between

structures (Fig. 6). Four trenches were completed for a total of 224 m. Each sampled

interval was 1.5 – 2 m long. They were taken in a channel (25 – 30 cm wide) across the

different outcrops. Each sample was described and recorded in Excel spreadsheet.

Geophysical surveying

Geophysical exploration was performed by Valdor Geophysics in early 2005.

Valdor used induced polarization and resistivity (IP/Res), differential GPS and Total

Field Magnetic (TFM) methods covering 1.2 km of strike length along the north-south

corridor trend. Each section line (100 m spacing between lines) was interpreted in the

Lima office for future consideration of drill holes (Fig. 7 and Fig. 8)

Drilling and logging

Drilling occurred in three phases. Forty-two shallow core drill holes for a total of

5033.6 meters were drilled as of May 31, 2007 (Bear Creek is still drilling the project).

Holes were drilled with a L-250 model drill rig. Each HQ core interval was placed in a

carboard box and then was taken by truck to the field camp for geologic logging and

preparation of analytical samples. Logging attempted to distinguish different type of host

18
rocks ore and gangue minerals, characteristics of the structures, and alteration. Each box

of core was photographed (Fig. 9).

Petrography

Petrographic examination of 13 thin sections was done in order to identify the

main ore minerals and alteration products, paragenetic sequences, and textures relevant to

likely metallurgical behavior. Photos were taken (Fig. 10, 11).

Soil sampling

Soil samples were made in a grid of 50 x 50 meters in the northern and southern

parts of Anomaly B (Fig. 12). Samples were collected from the B soil horizon in 1 x 1 x

0.8-meter pits dug with a pickax. Samples were then seived and then placed in a special

bag for analysis.

Geologic modeling

A 3-D solid was constructed using Mintec MineSight® software. Drilling and

geologic information from the first 50 drill holes were imported (Fig. 13, 14) to develop a

3-D solid of the initial shape of the deposit (Fig. 15). The data were then subjected to

geostatistical analysis (Fig. 16), and a 3-dimensional block model (Fig. 17, 18) was

constructed that resulted in a possible resource estimate (Table 2).

19
 Exploration Operations

Trenching

Four trenches were excavated in the Anomaly B area with the following results:

Trench Total meters sampled (2m/sample) Location Ag average grade (ppm)

1 126 East Breccia 23.66

2 24 West Breccia 80.13

3 4.5 close to W Breccia 80.67

4 6 north of W Breccia 106.50

Drilling

There have been three phases of drilling at Santa Ana since its discovery in 2006.

This paper is based on the first 42 drill holes (5033.6m) that Bear Creek completed as of

May 31, 2007. (See drill core samples Fig. 19A-F).

First phase: Eleven extremely widely spaced holes (more than 250 m apart on average)

were drilled by the contractor, Bradley, during June 2006. A total of 1120 m of HQ core

were drilled. The holes confirmed the possible bulk tonnage potential of the property and

provided the first strong evidence for mineralization controls.

20
 These holes (e.g., SA-2) indicated that the type and degree of alteration of lavas

and dike were similar at the surface and at depth. Small volcanic breccias (auto-

breccias?) were found in a few holes (e.g., SA-3) with the same alteration patterns:

feldspars are altered to illite-sericite, and mafics are chloritized. Similar patterns were

found in all holes. Disseminated pyrite is present in amounts of <1% to 2% in a few

holes. Crackle breccias in drill holes correlate with the surface projection of crestones,

the vein-breccias that exhibit a hackly texture. The degree of fracturing, abundance of

barite, and abundance of jarosite correlate with presence of silver mineralization, though

they are not necessarily indicative of economic values. Most of the holes had an azimuth

between 100º and 300º, with a dip of -60º (to the E or W) and a depth of 100m. Sulfides

are predominantly oxidized in the upper 60 m, but in a few holes mixed zones appear

beginning at 40 m (e.g., SA-2). See Table 3 for silver values.

Second phase: Twenty-three additional holes were drilled before the end of 2006,

totaling 3191 m in this phase. Deeper holes were drilled (171.40m in drill hole SA-19A).

Holes were drilled mainly oriented between 130º and 180º with dips of -60º. Holes

oriented in a scissor pattern were drilled from some platforms (e.g., SA-3, SA-3A, SA-

3B, SA-3C). Lavas, volcanic breccias, and dikes were also found in this phase, with

similar characteristics and alteration patterns as in the first phase. The structures (veinlets

and veins, from mm up to 30 cm) observed dip at low angles (between 45 and 15º) to the

drill core axis. Oxidation persists to approximately 60 m. Good silver grades are related

to degree of fracturing, presence of barite, and presence of chalcedonic silica + carbonate

infill (see Fig. 19C). See Table 4 for results.

21
 Third phase: This paper considers holes drilled through SA-39A (as on May 31, 2007),

but drilling continued at least through all of 2008. Characteristics of host rocks and

alteration observed in this phase were similar to earlier phases. Lavas are intercalated

with volcanic breccias; both are clay – chlorite altered, and both are cut locally by the

dacitic dike. The best mineralization is restricted to low-angle centimetric structures and

dilational open-space filling. Barren Puno sandstones also were encountered in this phase

of drilling (drill hole SA-30A at 32m) for the first time. It is not clear yet what controls

the presence of these sedimentary rocks, but maybe there presence is related to a

secondary structure and associated uplift and erosion on the north-northeastern side of the

project.

Some important results are shown in Table 5 and Table 6.

22
 Regional Geology and Tectonics

The Santa Ana deposit is located in a Miocene andesite-dacite arc terrane

constructed on the Altiplano as part of the Andes in southeastern Perú. Southeastern Perú

contains rocks that range from Paleozoic clastic sedimentary rocks to Recent volcanic

rocks, including immense volcanic centers that produced Late Miocene to Pliocene

Barroso pyroclastic rocks. There are different opinions about the importance of the

Cenozoic strike-slip faulting in southeastern Perú, especially in the Altiplano area (Herail

et al., 1996; Horton, 1996). Paleozoic sedimentation started with marine sandstones of

Ordovician age, which are overlain by Siluro-Devonian marine shales.

Early tectonic activity in the region occurred mainly in two phases. Early

Hercynian tectonism (Late Devonian) was characterized by tectonic compression, which

formed the folds that are responsible for the angular discontinuity between Lower

Devonian rocks and the overlying deltaic sedimentary rocks of the Mississippian Ambo

Group (INGEMMET, 1995). A minor disconformity between Mississippian sedimentary

rocks and overlying Permian sedimentary rocks is a result of strong folding north of Lake

Titicaca that formed during Late Hercynian orogenesis. The Paleozoic closed with the

basic volcanism of the Iscay Group (270 Ma).

Mesozoic sedimentation started with deposition of Lower Jurassic to Lower

Cretaceous rocks in the Yura basin, which was filled with terrigenous sediments of the

Yura and Lagunillas Groups. In the lower to middle Cretaceous, the site of deposition

23
shifted to the east from the Yura basin to the Putina basin, which continued into the lower

Tertiary as the Puno Group (INGEMMET, 1995).

Three phases of calc-alkaline volcanism developed in the Tertiary in the western

Cordillera (INGEMMET, 1995), forming rocks of the Tacaza Group (upper Oligocene to

lower Miocene), Sillapaca Group (middle Miocene), and Barroso Group (upper Miocene

to Pliocene) (Fig. 20). Volcanism continued until the Quaternary.

In southeastern Peru, Andean orogenesis started in the Santonian with the

Peruvian orogeny. Folds were formed in the Yura basin during epeirogeny and erosion

that define the Incaic orogeny, which started a phase of molasse facies deposition of the

Puno Group in the Altiplano that continued until the Oligocene (INGEMMET, 1995).

Five phases of the Neogene Quechuan orogeny are recognized on the basis of

stratigraphy and geochronology (INGEMMET, 1995): post- Puno/ pre-Tacaza (~30 Ma);

intra-Tacaza and pre-Palca (~22 Ma); post-Palca to post-Puno (~16 Ma); and post-Maure

to pre-Barroso (~7 Ma); and overthrusting of the Ayabaca Shale (<7 Ma).

Mineralization occurs along a wide belt that trends northwest-southeast

(INGEMMET, 1995). Paleozoic rocks are mineralized with W, Mo, and Sb near post-

tectonic Permian intrusive rocks. Tertiary mineralization is principally associated with

outcrops of the Tacaza Group, west of the Alto de Cabanillas. The principal metals

associated with the Tertiary mineralization are silver, lead, and zinc, with minor copper

and gold.

24
 District geology

The Santa Ana deposit contains continental sedimentary rocks that have been

assigned to the Puno Group, mineralized volcanic lava flows and auto-breccias of the

Tacaza Group, a pre-ore Cenozoic dacitic subvolcanic intrusive dome and dike, and post-

ore pyroclastic rocks of the Barroso Group.

The Puno Group consists of a broad accumulation of arkosic red sandstones and

conglomerates with rounded clasts of fluvial origin. Shales, mudstones with intercalations

of calcareous beds, and evaporites are present locally. The Puno Group was deposited

between the Upper Cretaceous and the early Oligocene (83 - 35 Ma). In the Santa Ana

area, sandstones of the Puno Group are observed in the northeastern part of Anomaly B

(Fig. 2) and in drill hole SA-30A at 32 m. To date, sedimentary rocks of the Puno Group

are barren of mineralization.

The Tacaza Group of Oligocene-Miocene age is composed of andesitic lavas that

commonly were deposited discordantly on Mesozoic rocks or rocks of the Puno Group.

Locally, however, rocks of the Tacaza Group were deposited on Paleozoic rocks. The

Tacaza Group is one of the main hosts for epithermal deposits across Perú (e.g., Corani

deposit in Puno; Yanacocha district in Cajamarca). In the Santa Ana area, the Tacaza

Group is the principal host of silver mineralization. Lavas of the Tacaza Group dip 15º to

60º west. The Tacaza Group is overlain by the Cenozoic tuffs of the Barroso Group.

25
 The dacitic quartz-feldspar porphyry seems to be one of the Cenozoic intrusions

that occur in southeastern Perú. It is present in Santa Ana in the Anomaly B area as a

crescent-shaped dike and in the Anomaly A area as a lava dome (Fig. 21B).

The Barroso Group of Mio-Pleistocene age is related to volcanic centers that

closed the effusive and explosive volcanic Tertiary sequence in the Peruvian Andes.

Lithologically the Barroso is composed of andesitic, trachyandesitic, and dacitic lavas,

breccias, agglomerates, and tuffs. The lavas are mostly basaltic andesites or hornblende

andesites. Some rocks of the Barroso Group are of interest because they host epithermal

Au-Ag mineralization. In the area of Santa Ana, a tuff of the Barroso Group is in the

western part of the Anomaly B (Fig. 2) overlies mineralization. No silver anomalies have

been found in the Barroso Group.

26
 Geology of Anomaly B Area of the Santa Ana Deposit

Overview

Anomaly B is the most important area of mineralization at Santa Ana (Fig. 2 and

Fig. 21a). It is located approximately at 8158000 North and 466000 East UTM grid

coordinates using the PSAD 56 map datum (zone 19). Colonial workings are present

(approximately 50 small workings) (Fig. 3). Anomaly B comprises a zone of 1,300 m

north - south by 500 m east - west. Recent drilling has shown that this area has been

extended by at least 200 m in both directions and still remains open in all directions.

Rock types

Mesoscopic characteristics: The main outcrops are andesitic lavas of the Miocene

Tacaza Group that are cut by a Cenozoic dacitic dike that is related to a dome located 1.5

km to the north-northeast. Felsic tuffs of the Barroso Group overlie the mineralized lavas.

Between the lava flows, it is common to find volcanic breccias (mostly monolithic

autobreccias but apparently locally including heterolithic breccias). Volcanic breccias

have been observed mostly found in drill holes. Hydrothermal intrusive(?) breccias have

been reported in recent drilling, although they were observed since the beginning of

exploration on a dump in the southern part of the area before any holes were drilled (A.

Swarthout, pers. commun., 2005) and at the end of drill hole SA-2A.

Petrography: These three samples (see Fig. 10) correspond to a porphyritic

volcanic rock with microgranular to microcrystalline matrix. Plagioclase occurs as

27
phenocrysts and in a microcrystalline matrix, with different shapes from subhedral to

anhedral crystals and sizes up to 2,6 mm. Quartz, located in the groundmass, comprises

approximately 5% of a sample, and is up to 0.3 mm in size. Accessory minerals present

in the sample are zircon, sphene, and apatite. Hydrothermal minerals are observed and are

described further below.

Structural geology

The main structures observed are vein-faults, and fracture sets that exhibit

negligible or indeterminate offset of geologic markers. Where mineralized, bedding faults

are observed, the faults exhibit a normal sense of displacement. Two main orientations of

faults and fracture sets have been observed at Santa Ana: north-south and east-west.

The majority of veins, vein–breccias, and crestones (vein-breccias that exhibit a

hackly texture) have north-south strikes. Veins can be from 20 cm to 1.5 m wide at the

surface, although open space fillings and stockworks related to the veins can mineralized

over widths of up to 40 m. In drill core, vein-breccias occur in zones with intense

crackling and/or shearing with chorite-illite-pyrite alteration, typically 10 cm to 3 m

wide. Similar widths of mineralization occur with the crestones. Mineralization also

occurs parallel to bedding in the lavas (15 – 60º to the west). Some north-south structures

vary in strike to north-northeast (015°-045°), creating dilational zones. Some north-

northeast to northeast-striking fractures can be considered splays or horsetails on the

main east-west structures (Fig. 22). The old workings continue south of Anomaly B (for

at least 1 km), where surface sampling is getting silver assays as high as 90 ppm.

28
 The east-west trending structures are present as veins, veins-breccias, and lesser

crestones. These structures divide the north-south trend structures into blocks.

Mineralization

Mode of occurrence: Main structures in the area are the “East Breccia”, the

“Northwest Breccia” (Fig. 21a) with a predominantly trend of north-south, and the “East-

West Structure” in the southern part of Anomaly B (Fig. 22). These structures are

considered to be hydrothermal - tectonic breccias that are moderate to strongly chloritized

in parts. At the surface, breccias contain jarosite or argentojarosite?, barite, manganese

oxides (presumably an alteration product of carbonates such as rhodochrosite or

manganoan calcite), pyrite, primary magnetite, ,and hematite after oxidation of

magnetite.

A dacitic quartz-feldspar porphyry dike occurs in a dilational zone between both

“crestones” (Fig. 4). At the surface, the dike is anomalous in silver (from 2 ppm to 21

ppm), but at depth high grade structures occur at the dike - lava contact or inside the dike,

with values up to 1000 ppm silver. Some old colonial workings (rich structures) are

present at the contact lava - dike. The dike can only be seen in an area of 600 m long by

15 m wide. Lavas are present in most of the area, and they are moderately fractured and

can have values up to 31 ppm silver, even when they are not close to the vein-breccias.

Jarosite (argentojarosite?), barite, and manganese after carbonates can be seen in those

fractures. Volcanic breccias (autobreccias) intercalated with the lavas contain the same

amount of Ag mineralization, with values up to one ounce Ag if there is no structure

nearby.

29
 To the east of Anomaly B, the same Tacaza lavas are exposed but no important

mineralization has been found. The truck route on the extreme eastern end of Anomaly B

may coincide with a major fault that is controlling the eastern limit of mineralization.

Only some spots of manganese can be seen in the eastern part of this Anomaly, but no

important structures have been recognized to date.

Outcrops samples in this area (335) average 43g/t Ag and mineralized structures

(78 samples) average 237 g/t Ag. Also, 25 samples taken from dumps average 154 g/t,

but these samples are not included in the general average of 85.4 g/t Ag. Silver anomalies

correlates with lead (0.37% average), zinc (0.32% average), and barium (up to 4200 ppm)

anomalies.

Mineralogy and texture: Veins that cut the lavas of the Tacaza Group are

composed of galena, sphalerite, rutile, magnetite, hematite, chalcopyrite, argentite, and

pyrite. At the microscopic scale, galena fills the open space and microfractures of the

gangue minerals (e.g., as micro-veinlets in barite). In part it replaces hematite, pyrite,

chalcopyrite, and sphalerite (Fig. 11a, 11b, 11c). Galena also fills some holes in

sphalerite. Sphalerite can be found disseminated and in the cleavages of the alteration

minerals. Magnetite is disseminated and is intergrown with rutile. Rutile is associated

with magnetite and can be present as a weak alteration to leucoxene. Hematite is present

as radial aggregates and is included in gangue minerals (Fig. 11c), and in this way its

distribution is dispersed. There is also secondary hematite after magnetite. In few cases,

hematite can be observed replacing sphalerite. Chalcopyrite fills the interstices of the

gangue minerals. Argentite is present as veinlets filling the microfractures, and it replaces

30
sphalerite and galena (Fig. 11e). Pyrargyrite is possibly present as a dark ruby silver

mineral. Pyrite is disseminated between the gangue minerals.

At the surface, structures are in most cases veins-faults filled with barite-jarosite-

manganese-clay, and it is difficult to distinguish any silver mineral, although some people

reported seeing argentite and pyrargyrite on some dumps (G. Corbett, D. Volkert, A.

Swarthout pers. commun., 2007) At depth in the mixed sulfide-oxide zone (below 40m

depth in many cases), it is easier to see sphalerite, galena, and a little chalcopyrite. Silver

grades increase when light green sphalerite and galena occur with carbonate (ankerite?)

in veins that are at low angles to the core axis and when these reduced polymetallic

minerals are mixed with specular hematite. A positive correlation has also been observed

between vein width and silver grade in certain areas, but this is not a general correlation.

There is also a positive relation between silver grade and barite that occurs as invasive-

brecciated open-space fillings in the andesitic lavas.

Quartz content increases with depth (generally deeper than ~60 m), where it has

been observed that chalcedonic silica (low-temperature quartz) that is typical of upper

zones changes to a comb quartz texture at depth. This change, however, has been

observed only in certain drill holes (e.g., DDH-15, DDH-15A).

Broadly, the mineralogic zoning will be an oxide zone of jarosite-manganese-

hematite-barite in the first 20 m, an oxide-mixed zone from ~20 to ~80 m with oxides,

carbonate, and intermediate sulfidation minerals , and a sulfide zone beginning at ~80-

100 m, where pyrite, low-iron sphalerite, galena, argentite, tetrahedrite(?), plus secondary

hematite appear together in some holes. Pyrite is present as 1-2% disseminated grains in

the host rock (lava), and there is not a clear increase in abundance except close to

31
structures (in the alteration halo) or in the structure (10-20%, e.g., DDH-SA6 @ 170 m).

Hydrothermal magnetite is present (e.g., DDH-SA6) in very few parts of the area (it may

be detected where the chargeability geophysical anomaly increased, e.g., DDH-SA6).

The more abundant sulfide mineral in the host rock is pyrite, and in the structures are

sphalerite and pyrite, follow by galena.

Pyrite is a mineral that is present as 1-2% disseminated in the host rock (lava) and

there is not a clear increase of it until it is close to structures (as alteration halo) or part of

the structure (10-20%, e.g., DDH-SA6 @ 170 m). Hydrothermal magnetite is present

(e.g., DDH-SA6) in very few parts of the area (it may be detected where the chargeability

geophysical anomaly increased, e.g., DDH-SA6). The more abundant sulfide mineral in

the host rock is pyrite, and in the structures are sphalerite and pyrite, follow by galena.

Wall-rock alteration

Alteration in andesitic lava flows: The main hydrothermal minerals observed in

the andesitic lavas of the Tacaza Group (Fig. 4) are illite-sericite as a product of alteration

of the plagioclase phenocrysts (Fig. 10), chlorite after ferromagnesian minerals, and

calcite associated with chlorite and possibly originating from alteration of ferromagnesian

minerals. Quartz is also present in trace amounts, giving the samples the common district

propylitic assemblage: chlorite-sericite-calcite-quartz. Rocks seem to be more intensely

bleached (illite-pyrite-chlorite) adjacent to structures, but this occurs for a few

centimeters on each side. In the northwestern part of this area, there is a slight increase in

kaolin close to the old workings, where values can be as high as 20 ppm Ag.

32
 Alteration in dacite dike: The dike presents the same alteration as the lavas. Its

feldspars are altered to illite- sericite and its mafics are altered to chlorite. Pyrite and

primary magnetite are disseminated in the dike.

Surface mapping, sampling, and logging show few spatial variations in alteration.

In Anomaly B, veins of barite-jarosite-manganese, 10 cm to 2 m wide with illite-pyrite-

chlorite halos in the northern and western parts of the area (more typical maybe in

crestones), with a more chlorite-clay-pyrite halos in the rest of the area. Illite may be

dependent of a supergene effect, and it clearly evident in some dumps and old workings

in the northern and west parts of the area. Adularia has not been observed either on the

surface or in drill holes to date. Quartz is found in minor quantities on some old dumps,

but very little quartz was mapped at the surface.

Veins, vein-breccias and open space fillings and stockworks wall rocks in Santa

Ana are mainly altered to chlorite-pyrite assemblages, although structures in core show

more abundant illite or other phyllosilicates near the surface, probably due to weathering

effects. Some structures are bleached for up to 1.5 m from structures in the upper parts of

the drill core, but this halo disappears at depths of 20 to 30 m. The only obvious change

in alteration is that halos of chlorite-pyrite alteration increase in width when the structure

is wider.

33
 Geology of Anomaly A

This area is located north of Anomaly B (see Fig. 2 and Fig. 21A-B), and it is

about 800 m long by 300 m wide. Anomaly A is composed of lavas of the Tacaza Group

with the same clay-chlorite alteration as observed in Anomaly B. Anomaly A contains a

quartz feldspar porphyry (QFP) dome that is the root for the dike that crops out in

Anomaly B (see Fig. 21 and Fig. 4). The dome is outcropping with the same clay-chlorite

alteration seen in Anomaly B.

Most of the barite, jarosite, manganese structures are oriented north-south to

north-northeast, with sub-vertical dips. Many structures are located in the edges of the

dome, although others can be found in the center cutting the dome, with values up to 100

ppm silver. High dump values were also taken with results of 118, 160, 311 and 768 ppm

in silver. This area is considered as an important prospective area due to the number of

old workings present. Weak increase of silica and pyrite in the bottom parts of the dacite

dome are important in this area. Further deep holes should be drilled here to test for

possible increases in the grade of mineralization with depth and for the presence of a

possible mineralized porphyry copper/ copper-gold deposit at depth.

34
 Geophysical Characteristics

Geophysical surveys consisting of ground magnetics, induced polarization, and

resistivity were completed in 2005. These surveys define an area of sulfide mineralization

underlying the geochemical anomaly, interpreted to contain >5% sulfides) (Bear Creek

Annual Report 2006).

The IP response suggests that vertical continuity is good and that the

mineralization is open to the south, where strongly anomalous silver was found in

outcrops at the limits of the sampling grid. Three chargeability anomalies are outlined by

the induced polarization-resistivity survey (Fig. 7). The chargeability responses range

from weak (7mV/V) to strong (20mV/V) with respect to the background. The

chargeability response increases from surface to depth, suggesting differences through

leaching (VDG del Peru SAC, 2005).

A hole (SA-6) drilled in the area of one of the strongest induced polarization

targets (Fig. 8) found 5% pyrite as disseminated grains and veinlets of pyrite + weak

secondary magnetite veinlets at 140 m. No direct evidence of a porphyry deposit was

observed.

35
 Soil Samples

Soil samples were collected in two phases in 2006 and 2007. Samples were

collected on a grid of 50 by 50 m. Both phases of sampling were conducted only at

Anomaly B. The first phase was done in the south-southwestern to southern part of

Anomaly B in a 1000 m x 1250 m area, and the second phase was in the northern part in

an area of 750 m x 500 m (Fig. 12).

Bear Creek got good values (e.g., 12 ppm silver in soil sample # 51136) in a few

areas that are coincident with buried structures, the presence of which has been confirmed

by drilling (e.g., structures in new holes SA-44, SA-44A).

36
 Geologic Interpretations and Discussion

Structural interpretation

Many ore deposits are localized by major thoroughgoing structures that may

display variable activity histories, especially if the structural setting provides dilational

sites for the enhanced flow of hydrothermal fluid (Corbett, 1994; Corbett and Leach,

1998).

Santa Ana is a structurally controlled ore deposit. Veins at Santa Ana formed

during an episode of extension, as interpreted from the presence of normal faults and the

great thickness of some open-space filling veins and related extension fractures. In the

southern part of Anomaly B, a prospect-scale jog occurs where north-south striking

structures change in orientation southward to northeasterly striking structures. A second

jog occurs further to the south, where there is a transition from northeasterly striking

structures to north-northeasterly striking structures at Anomaly C (800 m south of

Anomaly B; see Fig. 2). Such a variation within mineralized fractures would be

consistent with a component of dextral strike-slip movement that might facilitate the

development of ore shoots within flexures (Corbett, 2007) (Fig. 22), which is consistent

with good Ag grades in drill holes SA-3, SA-4, SA-12, and SA-15.

Normal fault movement parallel to bedding in volcanic rocks is interpreted to be

due to a collapse of the lava flows on the western margin (Corbett, 2007; possible border

of a diatreme?), where there are hydrothermal breccias (e.g., SA-38, SA-38A, SA-2A;

Photo 19A). Alternatively, bedding-parallel flow could have been promoted by bedding

37
plane shear due to a component of uplift or doming within the north-south structural

corridor (east side of Anomaly B), although no evidence has been found to support such

uplift. The hydrothermal breccias are characterized by slab-like breccia clasts, which are

typical of environments characterized by collapse Corbett, 2007; Corbett and Leach,

1998). A common character in most holes at the southern part is the low-angle (15-25°)

between the millimeter- to centimeter-scale structures and the 60-70° inclination of the

drill holes. This sheeted character shows a dilatant character (Photo 23) due to the normal

bedding movement, and these sites localize polymetallic sulfides, carbonate minerals, and

high-grade silver values (Fig. 23A).

The east-west striking structures present in the area divide the north-south

trending structures into blocks. Mineralized structures exploit the east-west shears and

north-northeast trending splay faults, which may be indicative of a component of sinistral

strike-slip movement on the east-west structures in the area of the Spanish mine workings

(Corbett, 2007) (Fig. 22).

Paragenesis

From the study of drill core and thin sections, hydrothermal minerals are

interpreted to have been deposited in the following sequence: hematite – pyrite –

sphalerite-argentite-galena and carbonates. Four different stages can be inferred.

Stage I: Intrusive dome, dikes, tectonic breccias are interpreted to have formed

above the magma chamber, which may have increased the permeability of the rocks for

future flow of mineralized fluids. Fluidized breccias with a milled matrix (Fig. 19B) and

38
possibly intrusion-related hydrothermal breccias (Fig. 19A) that may border a possible

diatreme (Ríos, 2007 ) also may have influenced ground preparation. These ground

preparation features are coincident with the district-scale, weak to moderate intensity of

propylitic alteration in the area.

Stage II: Barite, low-temperature quartz and specular hematite are interpreted to

have formed prior to the main economic mineralization event but after tectonic

brecciation. Specular hematite can be difficult to distinguish from galena when it is fine-

grained. Hematite has a red streak (Fig. 19E), whereas boxwork after galena leaves a

crimson red color (Fig. 19D).

Stage III: This is the main stage of deposition of ore minerals in the area, as

economic minerals overgrow barite and quartz. Pyrite, chalcopyrite, sphalerite, argentite,

galena are interpreted to be deposited in this stage. Hydrothermal activity may also have

promoted chlorite-pyrite-illite(?) envelopes on some of the main veins and breccias.

Hydrothermal-tectonic breccias formed in this stage.

Stage IV: Carbonates and amethystine quartz were deposited at the end of the

hydrothermal system. Carbonate developed in the upper portion of the hydrothermal

system perhaps from bicarbonate waters, and the mixing of these waters with rising ore

fluids may have promoted precious metal deposition (Corbett and Leach, 1998). This

could be an important control for silver mineralization at Santa Ana.

39
Geochemical environment

The mineralogy of the silicates and sulfides at Santa Ana record the near-neutral

pH and intermediate-sulfidation state of the ore-forming solution. Local gold anomalies

(e.g., 0.097 ppm Au in DDH SA-6, 120m) are spatially associated with specular hematite

and may also occur at deeper levels in the hydrothermal system, where hairline magnetite

veins are present at the southern part of Anomaly B, the site of the highest IP anomaly in

the area.

Fluid inclusion data for epithermal silver-polymetallic vein deposits exhibit a

wide range of salinities (1-20 wt % NaCl equiv), although fluid inclusion data are not

available for Santa Ana. Fluids of moderate to high salinity are capable of transporting

significant quantities of silver and base metals (e.g., Seward and Barnes, 1997). The

epithermal deposits that have fluids of moderate to high salinities are either rich in base

metals or contain precious metals with subordinate amounts of base metals, such as

Fresnillo, Durango, Real de Guadalupe, Guerrero, and La Guitarra, Mexico (Simmons,

1991; Albinson et al., 2001). The high salinities in fluid inclusions could be interpreted to

be derived from either a magmatic source or interaction with evaporites. Much of the

Altiplano of southern Peru, including Santa Ana, is underlain by the Puno Group. The

Puno Group locally contains evaporites, so fluids with elevated salinities could have been

generated at Santa Ana because of interaction of ore fluids with evaporites.

40
Inference about fluid sources and causes of ore deposition

Mixing between fluids of different compositions can be a viable mechanism of

precious metal precipitation, as supported by some fluid inclusion data, extensive isotopic

data, and numerical simulations (e.g., Robinson and Norman, 1984; Mancano and

Campbell, 1995; Hayba, 1997). Ore fluids in epithermal deposits may contain a

significant magmatic fluid component; for example, ore fluids in bonanza parts of the

Comstock Lode appear to have had a significant (30-75%) magmatic component (Taylor,

1973; Vikre, 1989; Simmons, 1995). Santa Ana is interpreted to have a significant

magmatic component also because of the presence of hydrothermal magnetite veins,

hypogene (specular) hematite (typical of deeper parts in polymetallic vein systems), and

illite-pyrite alteration (Corbett, 2007). Ore minerals may have been precipitated at Santa

Ana by dilution and cooling and, to a lesser extent, from changes in oxidation state and

pH (Simmons et al., 2005).

Dilational zones are interpreted to have acted as sites for mixing of ore fluids with

bicarbonate waters because of its high grade and mineralogy (base metals-argentite with

carbonates; Photo 17, 18, 19, and 24). The quartz-poor character in Santa Ana may be

due of a suppression of precipitation of SiO2 during cooling as a consequence of fluid

mixing during ore deposition (M. Barton, pers commun., 2008).

41
Classification and distinctive characteristics of Santa Ana

Many classification systems exist for classifying precious metal deposits,

including by the sulfidation state of the contained minerals (Simmons et al., 2005). The

term sulfidation is used in ore petrology to describe the stabilities of sulfur-bearing

minerals in terms of sulfur fugacity (e.g., Barton and Skinner, 1979; Hedenquist et al.,

1994; Einaudi et al., 2003), and some authors use a three-fold classification of deposits

into low-, intermediate-, and high-sulfidation deposits (e.g., Sillitoe and Hedenquist,

2003; Simmons et al., 2005).

Santa Ana is here classified as intermediate sulfidation epithermal silver -

polymetallic deposit. Intermediate sulfidation state minerals present at Santa Ana are

pyrite, chalcopyrite, Fe-poor sphalerite, hematite-pyrite, magnetite-pyrite (Table 1).

Other examples of intermediate-sulfidation deposits (e.g.,) include Arcata, Peru

(Candiotti et al., 1990); San Cristóbal, Bolivia (Buchanan, 2000); the Comstock Lode

(Vikre, 1989) and Tonopah (Nolan, 1935; Bonham and Garside, 1979) in Nevada;

Creede, Colorado (Barton et al., 1977); and Pachuca-Real del Monte (Dreier, 2005),

Fresnillo (Simmons et al., 1988), and Tayoltita, Mexico (Smith et al., 1982). Santa Ana is

notable for its relatively quartz-poor character. Santa Ana also has similarities with the

carbonate – base metal Au-Ag deposits of the southwestern Pacific rim (Corbett and

Leach, 1998), such as Kelian, Indonesia (van Leeuwen et al., 1990).

42
Comparison of Santa Ana with other epithermal polymetallic vein deposits

Pachuca-Real del Monte, Hidalgo, México: Pachuca is an underground mine that

has been active since 1550 (Geyne et al., 1963; Dreier, 1976, 1982, 2005). This deposit is

hosted in calc-alkaline volcanic and hypabyssal rocks ranging in composition from

basaltic andesite to rhyolite. Alteration is characterized by the presence of quartz,

epidote, chlorite, adularia, albite, calcite, and pyrite, but quartz, adularia, and pyrite occur

as alteration envelopes around the veins. Orebodies are contained in a series of east-west,

northwest-southeast and north-south trending, fault-hosted veins. Productive ore zones

occur where there are changes in vein strike and dip (Simmons et al., 2005). The veins

range in width from 0.5 to 5 m, although vein-filling fractures can span zones up to 35 m

wide. Quartz, chalcopyrite, galena, and sphalerite are the common vein minerals. Silver

occurs mainly in acanthite. Fluid inclusion homogenization temperatures range from 210°

to 305° C, with salinities of 0 to 6 wt percent NaCl equivalent.

Santa Ana shows similar structural control and a mixing environment between

magmatic water and bicarbonate waters at similar depths in the system. Adularia was not

seen in Santa Ana but low-temperature quartz suggests the influence of meteoric waters

or boiling in the deposit.

Peripheral zones of Butte, Montana, USA: Peripheral zones of Butte show a

similar mineralogy to Santa Ana (McClave, 2007). The presence of quartz, rhodochrosite,

carbonates, sphalerite, pyrite with silver minerals in open-space filling veins are shared

43
by both deposits, implying that a porphyry copper deposit could be located possible

below the volcanic dome at Santa Ana.

Laykakota, Peru: Laykakota, located in Puno, was an important mine in the

1600’s. Mineralization is hosted by andesitic lavas of the Tacaza Group and occurs in

parallel, northeast-striking veins that dip to the east (INGEMMET, 1993). Veins are

between 1.5 and 5 m wide.. The ore minerals are galena, sphalerite, chalcopyrite, and

pyrite with barite and manganese. This deposit is significant for its relative proximity to

Santa Ana.

44
Resource Estimation

Assembly of drilling and geologic data

Fifty-five drill holes were used in the construction of a 3-D solid (Fig. 13, 14).

The total length of these drill holes is 9928 m. A database was constructed that contains

all the relevant data for each hole, such as drill hole locations and orientations, as well as

assays of each analyzed interval. The solid was constructed on the basis of silver values,

because silver is the most important metal economically in the deposit (Tables 3, 4, 5,

and 6). The dip angles of the mineralized structures were also taken into consideration.

Defining 3-D solid

Vertical sections and horizontal plans were made every 5 m using MineSight®

software. Both sets of slices were combined for construction of the 3-D solid. The shape

of the interpreted mineralized volume took into account the strike and dip of the

structures, constraints from field geology, the grades of the drill hole, and my

interpretation of grade continuity (Fig. 15). Two codes were used to differentiate

mineralized material from waste. Grades were interpolated only inside the volume of the

solid that defined the limit of mineralized material.

Geostatistical analysis

Conventional statistics and geostatistics were used to analyze silver assays from

holes drilled at the Santa Ana deposit. Using a cut-off grade of 18.50, the arithmetic mean

grade is 27.3 g/t. A variogram analysis for the deposit was done for silver to determine

45
the spatial continuity of the mineralization in the zones and to determine the parameters

for the grade interpolation of the block model. It was determined the variogram 3-D

considering horizontal grade of 30º and vertical grade of 22.5º. The variograms were

modeled using a single structure spherical model. The histogram shows that the average

grade is 27.3 g/t (Fig 16).

Grade interpolation and resource estimate

The 3-D block model is based on the shape of the 3-D solid and geostatistical

analysis of the data. The 3-D block model for mineral resource estimation was built with

blocks of 10 x 10 x 10 m (Fig. 17, 18). The block model was interpolated using the

kriging method. The ellipsoidal search parameters for the interpolation process were 100

(major) x 40 (minor) x 90 m (vertical).

Mineral resources, in order of decreasing level of confidence, are assigned to the

measured, indicated, and inferred categories (e.g., JORC, 2004). Because this model of

Santa Ana is based on only 55 drill holes that are widely spaced, this estimate is

considered a to represent a combination of the indicated and inferred resources. Future

drilling and geologic logging will provide new geologic insights and additional assay

data, which will eventually permit a better estimate of mineral resources in the future.

The total indicated and inferred resources from all zones in the deposit at a cut-off grade

of 18.50 g/t are 47.71 million tonnes of mineralized material grading 27.3 g/t of Ag,

totaling 41.9 million ounces of contained Ag. Additional drilling and economic inputs are

required before an ore reserve can be obtained.

46
Other Economic Inputs

Infrastructure

Infrastructure in Santa Ana is optimal because of the location of the property.

The deposit is close to a paved highway and to Desaguadero (a medium to large city for

the Altiplano). Water for a potential future mining operation can be taken from a large

river (Limancota) located 10 km north of the project. A power line needs to be

constructed from Santa Ana to an electrical sub-station located ~40 km away, which is

connected to the national grid. Construction will be relatively easy because the area has

moderate topography, typical of relief throughout this part of the Altiplano.

Mining

At this moment Santa Ana is viewed potentially as an open pit operation. High-

grade veins at depth may be amenable to underground mining, concurrent with or after

open pit mining. Future drilling will clarify this issue.

Metallurgy

Two phases of metallurgical leach tests have been done to see if the material from

Santa Ana is amenable to conventional cyanide leach recovery.

The first phase tested ten samples (representing both high- and low-grade

material) form different parts of five different core drill holes. The samples were crushed

to 70% passing 2mm. Three tests were made from these samples. The first tests were

performed by the ALS-Chemex laboratory in Lima and were cyanide-soluble shake tests.

The tests show that 55.5% leachable silver can be recovered (see results in Table 7). The

47
second tests were made in the Plenge metallurgical test laboratory in Lima and were

longer term, bottle roll tests performed on finely ground material. Results from the test

showed 85% recovery of silver of (see results in Table 8). Finally, the third tests were

made at McClelland Laboratories, Inc., in Sparks, Nevada, in which bottle roll tests were

performed on the un-ground course reject material. The average recovery of silver was

71% (see results in Table 9). Results from the three laboratories are summarized in Fig.

24.

The second phase of metallurgical testing was initiated with the objective of

evaluating samples in conventional heap leaching with and without pulp agglomeration.

The average silver recovery was 64.6%, achieved for the conventional column tests,

although in a conventional, commercial heap leach situation, the overall long-term silver

recovery should exceed 70% according to McClelland Laboratories. Ongoing

metallurgical optimization tests will be needed to establish the most economic crush size

for the heap leach. Standard flotation of lead and zinc will also be checked by future

metallurgical testing.

Economic Potential

An impressive resource has already been defined at Santa Ana, even though the

solid model was based on only 55 drill holes (as on May 31, 2007). The degree of

continuity of mineralization at Santa Ana may be an issue, which further drilling will

address. The metallurgical behavior of the material, based on heap leach tests performed

to date, also are encouraging. Hence further exploration of Santa Ana is certainly

warranted.

48
Conclusions

Santa Ana is a recent discovery of silver-polymetallic mineralization in the

Peruvian Andes. The Ag-Zn-Pb mineralization occurs in vein-breccias and open space

fillings related to extensional zones hosted by andesites of the Tacaza Group. Veins

contain sphalerite, galena, pyrite, minor chalcopyrite, and argentite and a late mixed

(MgCa) carbonate and are thus of intermediate sulfidation in character. Most Ag occurs

as argentite that overgrows sphalerite. Mineralization is spatially associated with

propylitic alteration (chlorite, pyrite) which was cut by veins that have chlorite-pyrite-

illite(?) (sericite?) envelopes. The deposit is notable because the veins are relatively

quartz-poor, and adularia has not been observed. High silver values in drill core occur

where carbonates and chalcedony occur with base metals. Silver may have been

deposited in an environment where CO2-bearing magmatic waters mixed with meteoric

waters.

Supergene processes in Santa Ana affect the upper 80 m of the deposit, which is

responsible for the possible presence of argentojarosite and may have contributed to

making the deposit more amenable to heap leaching.

There may be a spatial association with a porphyry system at depth, as is inferred

for some intermediate deposits. Quartz-poor character of Santa Ana makes this

intermediate epithermal deposit unusual in its style and should be taken in consideration

in future subdivisions in epithermal deposit types. The lack of adularia, although rare in

this deposit type, is not unique to Santa Ana because some deposits in Philippines and

Papua New Guinea contain sericite rather than adularia, indicating higher temperatures

and limited boiling which could be the result of greater depth of formation. An estimate

49
of the resource that was based on the first 55, widely separated drill holes contained 41

million ounces of silver in 47 million tonnes of mineralized material with an average

grade of 27.3 g/t Ag. There is good potential to increase the size of the resource with

further drilling, and certain key, non-resource economic inputs (such as infrastructure,

metallurgical performance, and amenability to open-pit mining) appear to be favorable.

50
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57
 Figure Captions

Fig. 1. Location map of the Santa Ana deposit. Map shows location within Puno

Province, southeastern Perú (Bear Creek Mining Corporation, 2008).

Fig. 2. Location map of Anomaly A and Anomaly B. Upper green square encloses

Anomaly A; below it is Anomaly B. The area now considered a new anomaly, Anomaly

C, is 800 m south of Anomaly B (Bear Creek unpublished data, 2005).

Fig.3. Photographs of old workings. Top photograph shows southern part of Anomaly B,

with dumps visible in the distance. Bottom photograph shows close up of old workings

(Photos by C. Ríos, R. Tonconi).

Fig. 4. Geologic map of Anomaly B. Area mapped at a scale of 1:2500 (Bear Creek

Mining Corporation, 2008).

Fig. 5. Detailed geological map of eastern side of Anomaly B (Bear Creek unpublished

data, 2005). Geology, with a focus on structural measurements in the vicinity of the East

Breccia, was mapped at a scale 1:1000.

Fig. 6. Photographs of trenches at Anomaly B. Top and bottom photographs show

trenches in southern and northern parts of Anomaly B, respectively (Photos by R.

Tonconi).

58
Fig. 7. Interpretation of 3D induced polarization and resistivity survey. Plan view

(VALDOR GEOFISICA, unpublished data, 2005).

Fig. 8. Interpretation of 3D induced polarization and resistivity section. Section is along

Line 7400 in Anomaly B (VALDOR GEOFISICA, unpublished data, 2005).

Fig. 9. Photographs of representative drill core box. View shows two boxes of core

totaling 6.40 m in length (Photo by C. Ríos).

Fig. 10. Photomicrographs of lavas. Phenocrysts of plagioclase are altered to illite-

sericite, and ferromagnesian phenocrysts are altered to chlorite, constituting a propylitic

type of alteration. Calcite may be associated with chlorite, possibly originating from the

alteration of ferromagnesian minerals. All the minerals are enclosed in a microgranular to

microcrystalline matrix composed of plagioclase, quartz, and chlorite. (Photos by P.

Gagliuffi).

Fig. 11. Photomicrographs of opaque mineralogy. A. Drill hole SA-03 (80.60m),

hematite (hm) being replaced by sphalerite (ef), chalcopyrite (cp) can be observed as little

grains between the gangue minerals (GGs) and the sphalerite. B. Drill hole SA-03

(80.60m), galena (gn) replacing sphalerite. C. Drill hole SA-03 (80.60m), galena and

sphalerite replacing anhedral crystals of hematite. D. Drill hole SA-11 (6.60m), veinlet of

sphalerite that is partially replaced by galena. E. Drill hole SA-17 (66.45m), proustite

59
associated with argentite replacing sphalerite, with galena replacing all minerals. F. Drill

hole SA-05 (38.40m), sphalerite replacing hematite. Right side: hematite filling holes in

the gangue (Photos by P. Gagliuffi).

Fig. 12. Location map of soil samples, Anomaly B (Bear Creek unpublished data, 2007).

Fig.13. Projection of drill holes to plan view, MineSight Software (Figure by C. Ríos, E.

Gutierrez). Yellow color: 20g/t Ag average. Green Color: 20-40g/t Ag. Red Color: more

than 40g/t Ag.

Fig. 14. Projection of drill holes to section view, MineSight Software (Figure by C. Ríos,

E. Gutierrez).Yellow color: 20g/t Ag average. Green Color: 20-40g/t Ag. Red Color:

more than 40g/t Ag.

Fig. 15. Solid shape from different views, MineSight Software. A. Looking north, 3D

view. B. Looking west, 3D view. C. N-S, Plan view (Figure by C. Ríos, E. Gutierrez).

Yellow color: 20g/t Ag average. Green Color: 20-40g/t Ag. Red Color: more than 40g/t

Ag.

Fig. 16. Histogram of Ag assay values (Figure by C. Ríos, E. Gutierrez).

Fig. 17. 3-D Block model, plan view (Figure by C. Ríos, E. Gutierrez). Yellow color:

20g/t Ag average. Green Color: 20-40g/t Ag. Red Color: more than 40g/t Ag.

60
Fig. 18. 3-D Block model, section view (Figure by C. Ríos, E. Gutierrez). Yellow color:

20g/t Ag average. Green Color: 20-40g/t Ag. Red Color: more than 40g/t Ag.

Fig. 19. Photographs of drill core. A. Hydrothermal breccia with intense illite-pyrite

alteration, SA-38A, 11.2m. B. Pyrite-bearing fluidized breccia dyke, SA-6, 138.7m. C.

Typical polymetallic Ag mineralization characterized by early quartz overprinted by

galena and light green sphalerite with later carbonate gangue, SA-15, 97.9m. D. Crimson

hematite developed from weathering of galena, SA-15A, 115.5m. E. Banded quartz-

barite-sulfide-carbonate vein with argentite within the carbonate vein portion, SA-2A,

75.7m. F. Chlorite shear with interlayered barite, SA-36A, 123m (G. Corbett,

unpublished report, 2007).

Fig. 20. Stratigraphic column, Puno (INGEMMET, 1993).

Fig. 21. Surface photographs, A. Anomaly B, left side (dark color): East Breccia, right

upper part: post mineral Barroso tuff. B. Anomaly A, right center: QFP dome (Photos by

C. Ríos).

Fig. 22. Sketch of geological relationships including dilational splays. (G. Corbett,

unpublished report, 2007).

61
Fig. 23. A. Conceptual geological model for Santa Ana. Figure illustrates the creation of

dilatancy within the pre-existing sheeted fractures where ore fluids (orange) have mixed

with bicarbonate waters to promote Ag deposition (red). Lower Ag grade mineralization

(orange) occurs in the absence of the fluid mixing environment. B. Dilational zone with

galena-sphalerite and later carbonate in drill core SA-29, 114.4m.

Fig. 24. Comparison of three phases of metallurgical test results (M. McClave,

unpublished report, 2007).

62
Ríos, Figure 1, Location map of Santa Ana.

63
Ríos, Figure 2, Location map of Anomaly A and Anomaly B.

64
Ríos, Figure 3, Photographs of old workings, southern part of Anomaly B.

65
Ríos, Figure 4, Geologic map of Anomaly B.

66
Ríos, Figure 5, Detailed geological map of East Breccia.

67
Ríos, Figure 6, Photographs of trenches at Anomaly B.

68
Ríos, Figure 7, Interpretation of 3D induced polarization and resistivity survey.

69
Ríos, Figure 8, Interpretation of 3D induced polarization and resistivity section.

70
Ríos, Figure 9, Representative photograph of drill core.

71
Ríos, Figure 10, Photomicrographs of lavas.

72
Ríos, Figure 11, Photomicrographs of opaque mineralogy.

A B

C D

E F

73
Ríos, Figure 12, Location of soil samples, Anomaly B, scale 1:2500

74
Ríos, Figure 13, Projection of drill holes to plan view, MineSight® Software.

75
Ríos, Figure 14, Projection of drill holes to section view, MineSight® Software.

76
 Ríos, Figure 15, 3-D Solid shape from different views, MineSight® Software.

B C

77
Ríos, Figure 16, Histogram of Ag assay values.

78
Ríos, Figure 17, 3-D Block model, plan view.

79
Ríos, Figure 18, 3-D Block model, section view.

80
Ríos, Figure 19, Photographs of drill cores, Anomaly B.

A B

C D

E F

81
Ríos, Figure 20, Stratigraphic column, Puno.

82
Ríos, Figure 21, Surface photographs.

83
Ríos, Figure 22, Sketch of geological relationships including dilational splays.

84
Ríos, Figure 23, Conceptual geological model for Santa Ana.

85
Ríos, Figure 24, Comparison of three phases of metallurgical test results.

100.0%

90.0%

80.0%

70.0%

60.0%

50.0%

40.0%

30.0%

20.0%

10.0%

0.0%
1 2 3 4 5 6 7 8 9 10

Recovery McClelland - Calced Heads Recovery ALS Recovery Plenge

86
Table 1. Diagnostic Minerals and Textures of Various States of pH, Sulfidation and Oxidation State. Used to Distinguish
Epithermal Ore-Forming Environments (Giggenbach, 1997, Einaudi et al., 2003) (the use of hyphens between minerals
indicate an equilibrium assemblage for which all phases need to be present)

Acid pH Neutral pH

Alunite, kaolinite (dickite), pyrophyllite Quartz-adularia ± illite, calcite

residual, vuggyquartz

High sulfidation Intermediate sulfidation Low sulfidation

Pyrite-enargite, ± luzonite, covellite- Tennantite, tetrahedrite, hematite- Arsenopyrite-loellingite-pyrrhotite,

digenite, famatinite, orpiment pyrite-magnetite, pyrite, chalcopyrite, pyrrhotite, Fe-rich sphalerite-pyrite

Fe-poor sphalerite-pyrite

Oxidized Reduced

Alunite, hematite-magnetite Magnetite-pyrite-pyrrhotite, chorite-

pyrite.

87
Table 2. Resource Estimate Determined with MineSight Software (50 drill holes)

Category Mtonnes Silver (g/t) Silver (Million Oz)

Indicated and Inferred 47.7 27.3 41.8

Based on 18.50 g/t cut-of grade, 70% Ag recovery.

88
 Table 3. Drill holes results, Phase 1.

Silver
Drill Inclinatio Total Interval
Azimuth From To (grams Lead Zinc
Hole n Depth (m)
(degrees) (m) (m) per (%) (%)
# (degrees) (m) DTH
tonne)
SA-02 105 -65 101.00 0 52 52 34.2 nil 0.6
includes 28 34 6 133.7 nil 1.3
SA-03 0 -60 99.50 48 96 48 87.1 0.5 1.1
includes 50 60 10 199 0.6 0.8
and 72 80 8 102.6 1.2 2.6
SA-04 305 -50 96.00 4 10 6 112 0.7 0.3
22 38 16 87.1 0.6 0.4
42 52 10 43.5 1.3 0.8
SA-05 280 -50 99.00 0 40 40 77.8 0.3 0.6
includes 0 16 16 140 0.3 0.7
56 66 10 68.4 0.2 0.4
SA-07 145 -60 100.00 0 52 52 56 0.5 0.7
includes 22 32 10 127.5 0.7 0.9
SA-10 30 -70 80.50 48 72 24 82.2 0.1 0.3
Hole TDs in 72 g/t silver
SA-11 172 -65 75.50 0 12 12 189.7 0.4 0.2
36 54 18 34.2 0.4 0.7

89
 Table 4. Drill holes results, Phase 2.

Interva Silver
Inclinatio Total
Drill Hole Azimuth From To l (grams Lead Zinc
n Depth
# (degrees) (m) (m) (m) per (%) (%)
(degrees) (m)
DTH tonne)
SA-3A 0 -75 106 48 106 58 84.2 0.6 1.0
includes 48 72 24 125.8 1.0 1.0
and 78 90 12 91.7 0.5 1.2
SA-10B 86 24 62 38 86.1 0.3 0.2
includes 38 52 14 163.1 0.4 0.2
SA-10C 86 0 86 86 38.4 0.2 0.3
includes 76 80 4 285.0 1.0 1.1
SA-12 0 -70 100 2 48 46 89.0 0.4 0.3
includes 16 22 6 172.0 1.0 0.7
and 42 48 6 418.0 0.7 0.2
SA-13 70 -70 152 10 82 72 40.2 0.2 0.2
includes 38 42 4 131.0 0.2 0.2
and 58 60 2 573.0 0.7 0.3
and 78 82 4 112.0 0.1 0.3
SA-13A 225 -70 169 8 44 36 35.3 0.1 0.2
includes 8 20 12 64.3 0.2 0.2
106 166 60 30.5 0.1 0.2
SA-15 280 -60 150 0 44 44 37.2 0.4 0.5
includes 34 40 6 113.3 1.2 1.1
114 122 8 50.8 0.2 0.3
136 146 10 56.6 0.3 0.3
SA-15A 100 -70 148 4 128 124 32.0 0.3 0.6
includes 4 16 12 66.7 0.2 0.4
and 104 120 16 82.8 0.5 0.8
SA-16 303 -70 153 6 114 108 35.0 0.3 0.4
includes 12 18 6 116.3 1.0 0.6
and 36 48 12 88.3 0.9 0.4
72 76 4 100.0 0.6 0.8
SA-17 270 -60 152 2 74 72 31.6 0.3 0.7
116 128 12 55.8 0.5 1.1
SA-19 123 -60 124 2 40 38 41.0 0.2 0.3
58 98 40 23.3 0.2 0.4
includes 72 76 4 88.5 0.2 0.3

90
 Table 5. Drill holes results, Phase 3.

Silver
Total Interval
Drill Hole Azimuth Inclination From To (grams Lead Zinc
Depth (m)
# (degrees) (degrees) (m) (m) per (%) (%)
(m) DTH
tonne)
SA-29 270 -50 218 44 112 68 38.4 0.2 0.6
includes 80 104 24 73.2 0.3 0.7
150 168 18 218.1 0.5 0.7
200 206 6 37.7 2.0 1.0
SA-29A 90 -45 166 2 68 66 66.4 0.2 0.5
includes 24 40 16 119.5 0.4 1.0
and 60 66 6 286.3 0.2 0.1
SA-29B 90 -75 173 34 48 14 27.0 0.2 0.5
66 150 84 35.9 0.2 0.5
includes 68 72 4 82.5 0.4 1.0
and 88 102 14 82.4 0.2 0.4
SA-30 270 -40 185 18 30 12 59.0 0.2 0.3
64 94 30 102.5 0.4 0.8
includes 70 80 10 145.2 0.4 0.9
and 86 94 8 153.0 0.6 1.1
124 152 28 48.4 0.3 0.6
includes 124 130 6 77.0 0.1 0.3
SA-31 280 -40 213
includes 62 98 36 81.3 0.3 0.4
and 116 120 4 97.0 0.2 0.2
and 158 160 2 180.0 0.6 1.0
SA-31A 100 -60 141 4 94 90 24.9 0.1 0.2
includes 86 92 6 83.7 0.3 0.3
SA-32A 105 -60 156 32 102 70 48.3 0.5 0.8

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 Table 6. Drill holes results, Phase 3, continued.

Silver
Drill Total Interval
Azimuth Inclination From To (grams Lead Zinc
Hole Depth (m)
(degrees) (degrees) (m) (m) per (%) (%)
# (m) DTH
tonne)
SA-35 270 -60 257.2 0 244 244 29.5 0.3 0.5
includes 82 94 12 122.5 1.0 0.9
and 116 140 24 84.9 0.6 1.0
and 188 192 4 90.0 0.1 0.1
SA-35A 90 -60 257.0 44 50 6 35.3 0.2 0.3
58 68 10 30.8 0.2 0.4
98 100 2 78.0 0.6 0.6
130 162 32 36.4 0.2 0.3
180 220 40 182.1 0.4 0.4
includes 204 208 4 1532.0 2.4 2.4
SA-35B 180 -60 242.0 0 100 100 18.8 0.2 0.5
138 210 72 37.8 0.2 0.3
includes 184 208 24 65.0 0.3 0.3
SA-36 300 -60 204.9 14 34 20 46.0 0.2 0.3
52 66 14 39.7 0.5 0.9
138 188 50 34.2 0.2 0.3
includes 146 158 12 61.5 0.1 0.2
SA-36A 120 -60 210.0 10 190 180 17.6 0.1 0.3
includes 116 130 14 101.6 0.3 0.3
SA-37 270 -60 210.5 46 48 2 100.0 0.6 1.5
66 110 44 32.0 0.2 0.4
includes 100 108 8 72.8 0.3 0.6
SA-37A 90 -70 215.2 42 194 152 45.9 0.4 0.8
includes 56 64 8 140.8 1.3 2.0
and 130 154 24 114.2 0.6 1.3
and 178 182 4 96.0 1.0 1.4
SA-38 270 -60 161.0 60 126 66 51.8 0.3 0.5
includes 78 90 12 138.0 0.6 0.7
SA-38A 90 -60 224.0 34 216 182 30.3 0.3 0.5
includes 180 188 8 164.5 1.3 1.5
SA-38B 135 -60 200 54 78 24 53.8 0.7 1.1
90 106 16 53.4 1.0 1.8
114 144 30 90.0 0.9 1.7
SA-39 300 -60 223.0 0 14 14 12.6 0.3 0.3
and 104 164 60 14.0 0.1 0.1
and 196 214 18 17.5 0.1 0.3
SA-39A 120 -60 190 0 120 120 53.4 0.7 1.1
includes 66 72 6 325.0 1.2 3.1
140 154 14 51.9 0.5 0.3

92
 Table 7. ALS Shaker Test.

Measured Cyanide Soluble Residual Shaker Ag

Hole Sample Head Ag (g/t) Ag (g/t) Cyanide (%) Recovery
16 2205 54 32.0 0.22 59.2%
16 2209 172 75.6 0.20 43.9%
3A 58537 238 137.7 0.19 57.9%
3A 58542 78 56.1 0.22 71.9%
13 58775 145 72.7 0.21 50.1%
13 58795 57 16.4 0.10 28.8%
14 58929 161 96.9 0.21 60.2%
14 58942 52 33.0 0.24 63.4%
15 59083 52 31.1 0.21 59.8%
15 59142 114 72.0 0.21 63.2%
Average 112.3 62.4 0.20 55.5%
.

93
 Table 8. Plenge Bottle Roll Test.

Sample Grind NaCN *Head: Residue: Extraction Reagents: kg/t

g/t Ag g/t Ag %
NaCN CaO
2205 57%-200M 0.10 57.4 8.7 84.9 1.0 2.4
2209 52%-200M 0.10 165.5 46.8 71.7 1.8 2.6
58537 51%-200M 0.10 226.8 8.1 96.4 3.8 1.8
58542 60%-200M 0.10 83.9 12.5 85.1 2.9 1.7
58775 49%-200M 0.10 133.8 15.1 88.7 1.1 2.4
58795 56%-200M 0.10 71.0 13.9 80.4 4.8 1.7
58929 54%-200M 0.10 164.9 31.0 81.2 1.9 2.1
58942 49%-200M 0.10 57.7 13.5 76.6 2.5 1.9
59083 52%-200M 0.10 52.7 8.2 84.4 1.2 2.6
59142 46%-200M 0.10 119.9 4.9 95.9 1.9 1.3
Average 113.4 16.3 84.5 2.3 2.1

94
 Table 9. McClelland Bottle Roll Test.

Lime
Calculated Residue: Extraction NaCN Consumption
SAMPLE Head Ag (g/t) g/t Ag % Consumption kg/t kg/t
2205 57.89 15.33 73.5% 0.20 4.7
2209 156.55 61.33 60.8% 0.98 6.1
58537 220.08 34.67 84.2% 3.18 3.7
58542 75.82 17.67 76.7% 2.26 3.0
58775 123.75 37.67 69.6% 0.37 5.2
58795 70.94 32.33 54.4% 4.13 2.1
58929 159.96 49.33 69.2% 1.42 4.9
58942 61.12 18.33 70.0% 2.00 3.7
59083 53.14 17.67 66.7% 0.34 5.9
59142 109.06 13.67 87.5% 1.52 2.7
Average 108.83 29.80 71.3% 1.64 4.2

95