2014-08-14_PERMIT FILE - M2014027 (3)

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will separate mineralized from non - mineralized material. The fine mineralized material will be transported by truck to an off -site mill for recovery of gold and silver. The coarse non - mineralized material will be moved to the waste dump. Mining is planned to commence approximately September 1, 2014 and continue for approximately ten years. Existing roads will be used for mine and waste dump access. A berm will be constructed on the outside of the existing road for water diversion and safety. As the open pit is developed a spiral shaped road will be used to access the bottom of the pit and to remove the mined material. All surface disturbances will occur on leased patented mining claims. No Federal lands will be disturbed. New ground disturbance will be restricted to within the historic open pit and on the adjacent historic waste dump. Current planning indicates approximately 9.68 acres will eventually be disturbed, 5.8 acres in the open pit and 3.88 acres on the existing waste dump. Mining and Processing The ore at Crystal Hill occurs in an outcropping, cone shaped, mineralized and altered breccia pipe. The breccia pipe is exposed in the bottom and east sides of the existing open pit. The country rock surrounding the breccia pipe ranges from coarsely jointed, unaltered quartz latite on the eastern side to weakly consolidated, broken, flat -lying agglomerates on the western side. The more erosion resistant quartz latite forms the mass of Crystal Hill and much of the high wall of the open pit. No soil exists in the open pit or on the existing waste dumps. Approximately 100 feet of the breccia pipe will be mined from its present surface exposures, approximately 9,000 feet elevation, to approximately 8,900 feet elevation by conventional open pit methods. Less than 35,000 tons of material will be mined per year and mining will be occurring less than 180 days per year. Crawler type tractors will be used to break and move the ore. No explosives are needed to break and move the mineralized material. The fragmented ore will be crushed and screened on -site, the fines loaded with a front -end loader into trucks and transported to an off -site mill. No more than approximately 1,000 tons of fine ore bearing material will be on site at any time. It will take no more than 30 days to move this material to the off -site mill. Mining should be completed within ten years; however, this projected time frame is tentative and based only on projections from historic resource estimates. Due to the geologic character of the Crystal Hill ore body, additional precious metal bearing rock may be found below and adjacent to the planned pit floor. The historic open pit has been engineered with slopes consistent with modern safe mining practices. A geotechnical slope stability analysis and a map is located at the end of this Exhibit. No subsurface water was encountered by previous operators while enlarging the open pit or in groundwater monitoring wells. The western side of the pit is day lighted and has topographic closure. This condition will continue to exist as the pit is deepened. No acid mine drainage exists, or emanates from the open pit inasmuch as the sulfide minerals and water necessary to produce acid effluent do not exist in the present ore zone at Crystal Hill.