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Ouray Silver Mines Inc. <br /> Technical Revision 15 May 24,2021 <br /> building at the outside edge of the mill tunnel and d)the decline tunnel,which provides <br /> equipment access to the crushing gallery from the mill tunnel. All these areas are shown on the <br /> attached drawing 100-GA which is a general arrangement drawing of the entire mill area. The <br /> original mill was designed by CH2MHil1 in Denver,Colorado based on ore samples and <br /> production targets for the mine and mill. Tunnel excavation began in March of 2013. Installation <br /> of mill concrete flooring,crushers, screens,ball mill, flotation cells,water handling systems, <br /> filter presses,control room,reagent storage,and electrical room equipment occurred in April of <br /> 2014. <br /> Barr Engineering of Minneapolis, Minnesota redesigned the mill in 2017 under OSMI direction. <br /> Mill upgrades were necessary to improve ore recovery.TR09 permitted replacing the previous <br /> single stage jaw followed by a cone crusher with two-stage jaw crushers and a rod mill to <br /> prevent clogging with fines. The original cyclone circuit was poorly sized to achieve the correct <br /> operating pressure given the expected tonnages;the screens that were approved under TR-09 are <br /> not reliant on operating pressure. Changes in the flotation system were also needed based on two <br /> years of successive metallurgical testing,which proved that changes in reaction time and <br /> reagents will improve metal recovery from the ore.. The changes are discussed in detail in <br /> Section 4 below. As permitted in TR-09,the mill filter building is being expanded to house a <br /> compressor room and reagent room as well as a small roof structure over the transformers near <br /> the mill entrance. <br /> A simplified flow diagram that outlines the milling process and indicates which components are <br /> new is found in Figure 1. A detailed flow diagram of the milling process is found in drawings <br /> MF and PI in Appendix 1. <br /> 3.1 Crushing <br /> Ore is transported by mine cars to the slusher tunnel(Coarse Ore Bin),which has the rail siding <br /> above the crushing gallery. The ore cars are side dumped to an approximate 400 ton coarse ore <br /> bin which sits directly above a plate feeder which slowly delivers ore to the first conveyor which <br /> feeds the Is`stage jaw crusher. <br /> Material leaving the primary jaw crusher is—2 1/2". Material is conveyed from the primary jaw <br /> crusher to a 3/a inch screen. Oversize from the screen is conveyed to a secondary jaw crusher and <br /> -3/4-inch fines are conveyed to the rod mill for I` stage grinding. At both jaw crushers dust is <br /> suppressed using water. The -3/4"from the screening and secondary crushing is delivered to the <br /> rod mill along with process water where the ore is ground to p80 of approximately 3/8-inch <br /> minus. <br /> Slurry discharge from the rod mill will be delivered via slurry pumping to one of two locations. <br /> In the initial first months to a year of operation the slurry will report to the ball mill discharge <br /> tank which would then report to Derrick screens for sizing. Once final design and construction <br /> of two 12,690 gallon slurry retention tanks are finalized,the slurry will be pumped to those tanks <br /> which will be located in the previously constructed fine ore bin. The two slurry storage tanks are <br /> currently being engineered and will not be in place when the mill is commissioned. The slurry <br /> storage tanks are for surge capacity and the mill can be started without them. The slurry tanks <br /> Page 5 of 12 <br />