Dolores

Overview

The Dolores mine is located approximately 250 km west of the city of Chihuahua in the Sierra Madre Occidental Range of northern Mexico.

Mining in the Dolores region started in the 1800s. Mechanized production occurred between 1915 and 1929, with no records of any production since that time. Incomplete mining records from 1922 to 1931 indicate that total production during this time was 117,000 ounces of gold and 6.7 million ounces of silver. The district then remained idle until 1993 when Minefinders Corporation Ltd. began acquiring a land position. The first gold and silver production began in November 2008 with commercial production commencing May 1, 2009.  In 2012, Pan American acquired Minefinders and the Dolores mine.

The Dolores gold mine is operated as a conventional open pit mine. Processing consists of crushing and cyanide leaching followed by Merrill-Crowe recovery and on-site refining. The operation processes approximately 18,000 t ore per day.

In 2011, the mine produced 74,193 ounces gold and 3.57 million ounces silver. Mine life is supposed to continue through 2028.

Location

The Dolores mine is located in the Municipality of Madera, about 94 km by road southwest of the town of Madera, and 250 km west of the city of Chihuahua, Mexico. The mine site is located in the Sierra Madre Occidental Range of northern Mexico and is accessible by road and by light aircraft. 

The area is rugged, with elevations ranging from 1,200 to 2,000 meters. Vegetation ranges from thorn scrub with cacti, to oak and pine forests at higher elevations. Some snowfall occurs in winter, but exploration and mining work may be carried out year-round.

Geology & Mineralization

The Dolores gold-silver deposit in the Sierra Madre Occidental is a low-to medium-sulfidation epithermal deposit hosted in Tertiary-age andesite volcanic rocks of the Lower Volcanic Series. Gold and silver mineralization is present in veins, silica stockworks, breccias and replacements. Deeper mineralization tends to be preferentially hosted in high-grade structurally controlled zones that evolve at higher elevations into wider stockworks, veinlets and disseminations. Minerals present include galena, sphalerite, stibnite, arsenopyrite, pyrite, silver sulfides, native silver and visible gold.

The mineralization considered here occurs in an area approximately 3,000 metres long and up to 1,000 metres wide, with over 600 metres of vertical extent. The bulk of the deposit is high in the system where feeders widen into breccias and stockworks up to a few hundred metres wide that form halos around the main structures. Grades in the feeders are in the ranges of 10 to 30 grams per tonne (“g/t”) gold and 300 to more than 1,000 g/t silver. Disseminated mineralization that lies adjacent to high grade feeder structures at upper levels has lower grades in the range of 0.3 to 2 g/t gold and up to 150 g/t silver. The width of coherent mineralization commonly is about 200 to 300 metres wide, and lies in zones that trend NNW and dip steeply to the west.

Some vein and disseminated gold-silver mineralization is known to extend in a NNW and SSE direction beyond the limits of the resource estimate area. This mineralization is considered to be exploration potential.

Mining & Operation

The Dolores Mine is operated as a conventional open pit mine. Mining is carried out by standard open pit methods, utilizing PC3000 Shovels, WD900 loaders, and 100-ton haul trucks. Ore control is drilling is carried out using angled RC drilling, with vertical blasthole drilling for blasting.

The Dolores mine provides ore to a crushing plant at a planned rate of 6.48 million tonnes per year. Overall mining strip ratio for the remaining mine life is 4.47 tonnes mined per tonne of ore.

The mine plan has approximately 16.5 years of commercial production remaining (Sep 2011)

Mine Equipment Fleet consists of:  HD785 100 T Haul Truck (15); PC3000 Hydraulic Shovel (2); PC300 Backhoe (1); WA900 Front End Loader (2); WA600 Front Loader (1); GD825 Road Grader (2); GD555 Road Grader (1); D375 Dozer (2); D155 Dozer (1); D61 Dozer (1); WD500 Wheel Dozer (2); HD785 Water Truck (2); IR DM45 Blasthole Drill (3); ECM780 Blasthole Drill (1); WA470-5 Tire Handler (1); Fuel & Lube Truck (1); Maintenance Welder (1); Maintenance Pickups (2); Grove 60T Crane (1); Genie Light Plants (6)

Processing

Process facilities consist of a three stage crushing circuit, a conveyor system, and a lined heap leach pad collects leachate solutions that are sent to a conventional Merrill-Crowe gold and silver recovery circuit. Run-of mine ore is sent through a primary jaw crusher, followed by secondary and tertiary cone crushers. The ore is crushed and conveyed to the leach pad at a rate of 18,000 tonnes per day.

Crushed ore is conveyed and stacked on the leach pad and a leachate solution is applied and allowed to percolate through the stacked ore solubilizing and mobilizing gold and silver mineralization from the ore into a “pregnant solution” which is then collected and pumped to the Merrill-Crowe plant to precipitate gold-silver with zinc dust, filtered and refined to doré.

During the course of 2012, Pan American will advance a scoping level study which will examine the potential economic benefits of the addition of a milling facility at Dolores.  The expected benefits of a mill addition would be to increase overall  gold and silver recoveries by fine grinding the higher grade and sulfide ores providing enhanced liberation of the mineralization for leaching.  As part of the study, Pan American intends to optimize the mineral resource model to provide enhanced resolution of the higher grade and sulphide ore mineral distributions necessary to accurately estimate the ability to define and selectively mine the mill grade ores. 

Environment & Community

The company plans to perform concurrent reclamation of the mine waste dumps by re-contouring the waste dump slopes to a 2.5:1 slope during normal operations. The cost for the mine dump reclamation is included in the mine operating costs. Dozers will perform the bulk of the work. When the last leach period is completed, the ore heap will be allowed to drain down and solution quality will be monitored for compliance.