La Parrilla Silver Mine

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Location:	Durango, Mexico
Nearest Landmark:	DURANGO
Distance:	65 Km SE of DURANGO
Latitude:	23° 44' (North)
Longitude:	104° 6' (West)
Type of Working:	Underground
Status:	Producer

The La Parrilla property consists of 69,450.87 hectares (171,616.20 acres) including one concession under registration process. The duration of the mineral rights concessions is 50 years, renewable over similar time periods. It is a group of producing underground operations consisting of the Rosarios / La Rosa and La Blanca mines which are inter]connected through underground workings, and the San Marcos and the Quebradillas mines which are connected via gravel road ways. The site is located approximately 65 km SE of the city of Durango, Mexico.(Apr/12).

SILVER, LEAD, ZINC mines.

* Technical report (Sep/11) on document PB105183.pdf, 151 pp.
* Technical report (Feb/09) on document Pa724772.pdf, 127 pp.
* Technical report (amended Mar/08) on document Pa606702.pdf, 125 pp.
* Technical report (Jan/08) on document Pa587720.pdf, 125 pp
* Technical report (Feb/07) on document Pa458258.pdf; 77pp.
* Geological evaluation report (Sept/06) on document Pa408562.pdf; 86pp.
* Technical report (Mar/06) on document Pa356989.pdf: 47pp.
* Geological evaluation report (Apr/05) on document Pa258481.pdf; 78pp.

Geology

La Parrilla mining district is located in the physiographic sub-province of Sierras y Llanuras de Durango. La Parrilla consists of a mining complex made up of five separate mines which includes mineral deposits situated on the surrounding border of the geologic contact zone between a diorite intrusive stock and a sequence of Cretaceous sedimentary rocks.

The diorite stock caused structural conditions favorable for subsequent emplacement of mineralization along faults and breccia zones, as well as replacement and skarn deposits into bed and contact zones.

The La Parrilla diorite crops out as an elongated stock with its main axis in a NE 45º SW direction and an extension of about 2.8 km, by about 1.5 km in width. Numerous dikes and sills branch out from the stock into the sedimentary rocks.

The sedimentary rocks comprise a sequence of dark-gray limestone of the Cuesta del Cura Formation
(Albian-Cenomanian). Overlaying this Formation a sequence of intercalated limestone and shale thin beds of the Indidura Formation (Upper Cretaceous) occurs.

The most important known deposits at La Parrilla occur as vein deposits that pinch and swell along strike,
as well as downdip. These are enclosed by three main structural systems within the mining district:

- The first structural system appears to be related in orientation (striking NE 60 deg and dipping SW) nearly vertical to the regional intrusive stock.

- The second structural system occurs with a general orientation of N 45deg to 75deg W dipping approximately 50deg to 85deg to the NE. It encloses some of the most important mineral deposits in the area, such as Los Rosarios, El Carmen, San Cayetano, San Jose, etc.

- The third regional structural system is oriented north-south and dips to the E from 45deg to vertical. It encloses important mineral concentrations, such as San Marcos, Quebradillas, Vacas and San Nicolas.

Mineralization

La Parrilla district mineralization consists of concentrations of silver, lead, and zinc, associated with gangue minerals such as quartz, calcite, and other minor elements.

Primary sulfides mineralization follows downdip within the mineralized structures containing pyrite, galena, sphalerite, argentite, some chalcopyrite, and other silver sulfosalts associated with quartz and calcite as gangue minerals.

Weathering of the La Parrilla mineralization has caused oxidization and secondary enrichment zones containing sulfosalts (cerargyrite, ,pyrargirite, stephanite) and carbonates (cerussite, hydrozincite, hemimorphite), sulphates (anglesite, willemite), and iron oxides (hematite, limonite, etc.) that may reach depths of up to 150 m from the outcroppings.

Similar geologic characteristics are present in other mining districts within the region, such as San Martin (Grupo Mexico), Sabinas (Penoles), and La Colorada (Panamerican Silver) where mineralization still exists at depths greater than 700 m.

The main La Parrilla mineral deposits are the following:

The Rosarios System
Temiz - La Blanca

San Marcos
Vacas
Quebradillas
Viboras - Quebradillas
El Recuerdo
El Parian
Quebradillas Breccia zone
San Nicolas
San Jose
La Gloria
Sacramento

Operations

La Parilla is a group of producing underground operations consisting of the Rosarios / La Rosa and La Blanca mines which are inter-connected through underground workings, and the San Marcos and the Quebradillas mines which are connected via gravel road ways.

La Parrilla operations include production from four different underground mines, and a small open pit.The underground operations are namely, Rosarios / La Blanca, San Marcos, Quebradillas and Vacas. An open pit has been developed on oxide ore situated atop the active Quebradillas underground mine, and is designated as the Quebradillas Pit. La Parrilla ore deposits consist mainly of veins and limestone replacement deposits with mineralization in oxides, sulfides mixed with oxides, and fresh sulfides; the main products from the mines are silver, lead and zinc, and small amounts of gold. T

La Parrilla includes a 1,425 tpd processing plant consisting of the 425 tpd cyanidation and new 1,000 tpd flotation circuits, buildings, offices and associated infrastructure. Construction is currently in progress, approximately 90% complete, which will increase the cyanidation circuit to 1,000 tpd. (Nov/11)

The mining operations of La Parrrilla are highly mechanized with liberal use of trackless, diesel-powered mobile mining equipment such as load-haul-dump (LHD) loaders, low and high profile dump trucks, electro-hydraulic drill jumbos, and ancillary mobile support equipment.

Mine development for La Parrilla is done with conventional drill-blast methods, and drilling with hand-held jackleg drills is being replaced with electro-hydraulic diesel-powered drill rigs. The development sequence is still drill-blast-muck, with mucking done with rubber-tired, diesel-powered LHD. Haulage of ore and waste is accomplished using both low-profile and highway type diesel dump trucks. Drifts and ramps require little ground support, and the operators are installing rock bolts with or without wire mesh, and also shotcrete in dubious ground of the backs and ribs of drifts and ramps, and also in stope backs. Most long and conventional raises are bored by contractors. Raises are largely unsupported with occasional rock bolting done where dubious ground conditions have been identified.

Life of Mine extended to 14 years as a result of a positive technical report which upgraded part of the mineral resources to reserves. (Sep/11)

All production data are sorted first by Commodity and then by Year into reverse chronological order.

A reported interest of 0% typically implies the existence of an option agreement.

, Durango Mexico Phone: Fax: Reference Date: March 4, 2013