Fuwan

The Fuwan silver property is located approximately 45 km southwest of Guangzhou, the capital city of Guangdong province, China. Access to the property is via the Guangzhou - Zhuhai highway, which passes through Gaoming City.

The property is located 2 km via gravel road northwest of the town of Fuwan (population 30,000). The town of Fuwan is well connected by paved highway and expressways to major cities, including Guangzhou (70 km highway distance), Gaoming (15 km), and Jiangmen (60 km).

Positive results of a feasibility study were announced in late September 2009. The study defines an operation based on underground mining and milling of the ore producing a silver/lead concentrate and a zinc concentrate on site in township of Fuwan.

The mine production of 3000 tpd is based on a crew rotation of three 8 hour shifts and over 330 days per year. A mining contractor is assumed for pre-production development (up to 2 years) as well as ongoing mine development. Mine life was estimated at 9.2 years.

The mine will be accessed by a single decline developed and mining will be with conventional trackless mechanized equipment. A 2 m minimum mining height was adopted for mechanized mining and mining methods will vary and be dependent upon ore body geometry, ground conditions, and ore grade - ore zones with lower grades will be mined by the room-and-pillar method. All stopes will be backfilled after mining is completed. Free draining hydraulic backfill was selected as the most appropriate method. This backfilling method will allow up to 45 to 50% of the tailings to be disposed of as hydraulic backfill underground, reducing the required size of the surface tailings pond.

The run-of-mine (ROM) from the underground mine will be crushed by a jaw crusher to 80% passing 150 mm, and then ground to 80% passing 100 µm in a semi-autogenous grinding (SAG)-ball mill-pebble crushing circuit (SABC).

A 3,000 tpd process plant has been designed for the Fuwan Project to process silver, lead and zinc bearing sulphide mineralization. The silver, lead, and zinc minerals will be recovered by a conventional differential flotation process. The produced silver-lead concentrate and zinc concentrate will be thickened and then pressure filtered separately prior to being transported to smelters. Depending on the lead head grade, the silver-lead concentrate may be further processed to produce a silver concentrate and a lead-silver concentrate.

Electrical power, water, telephone service, and supplies are available in Fuwan. The proposed minesite is large enough to accommodate tailings and waste disposal areas, and processing plant sites.