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Alamo Dorado mine, Mexico

1st August 2014

By: Sheila Barradas

Creamer Media Research Coordinator & Senior Deputy Editor

  

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Name: Alamo Dorado mine.

Location: The Alamo Dorado mine is located 45 km south-southeast of the town of Alamos, in the south-east corner of the state of Sonora, near the border of Sinaloa, in north-west Mexico.

Controlling Company: Pan American Silver.

Brief History: Exploration at Alamo Dorado has entailed primarily reverse circulation drill campaigns conducted yearly from 1998 to 2001. In 2000, a thorough mapping of surface exposures along drill access roads was undertaken. A more comprehensive 1:2 500 scale geological mapping programme was conducted in 2001 over an area of about 4 km2 in the project area. The results established the surface extents of the volcanic lithologic units, crosscutting dykes and alteration patterns.

After acquiring the project in February 2003, Pan American started an updated feasibility study based on an updated mineral resource and reserve estimate, as well as a conventional milling and leaching circuit. In 2005, Pan American approved a $17.6-million project to construct the mine. Site construction started in April 2005 and completion of the openpit mine and the processing facility was reached in the fourth quarter of 2006. Silver production began in 2007 and the mine has since become the company’s largest silver- producing mine.

Brief Description: The Alamo Dorado mine comprises the contiguous 509 ha Alamo Ocho and the 4 865 ha Alamo Dorado concessions, five exploration concessions covering 6 014 ha and surface rights covering 763.64 ha.

Geology/Mineralisation: The Alamo Dorado mine is located in the Sierra Madre Occidental mountain range, a late Cretaceous- to Tertiary-age volcanic plateau that extends for hundreds of kilometres through north-western Mexico. The volcanic sequence is divided into the upper and lower volcanic series. The lower volcanic series is of the late Cretaceous to early Tertiary age and consists of up to 1 000 m of tuffs, flows and volcanic breccias. The upper volcanic series is of the middle Tertiary age and consists of more than 1 000 m of ash flow and ash fall tuffs that lie unconformably on the lower volcanic series.

In the area of the Alamo Dorado concession, the upper volcanic series is present in the higher parts of the surrounding mountains, but has largely been removed by extensive erosion in the region. The rocks hosting mineralisation at the mine comprise a sequence of deformed, steeply dipping, Mesozoic-aged marine rocks that contain minor intercalated siliceous exhalite and pillow basalt. The Laramide orogeny event probably caused at least the first phase of deformation, which resulted in the development of a strong planar fabric and the metamorphism of the sediments to greenschist facies. Deformation of the rocks at Alamo Dorado was episodic and occurred before, during and twice after the mineralising events. The metamorphosed marine sedimentary rocks were intruded by several dykes and granodiorite stocks. Silver mineralisation is mostly hosted by the metamorphosed volcanic rocks, but weak mineralisation also occurs in a post- metamorphic porphyritic diorite dyke.

Reserves: Total proven and probable reserves as at December 31, 2013, were 5.1-million tonnes grading 71 g/t silver.

Resources: Total measured resources as at December 31, 2013, were one-million tonnes grading 43 g/t silver and indicated resources were 1.2-million tonnes grading 78 g/t silver.

Products: Silver.

Mining Method: Alamo Dorado is a conventional surface mine that uses hydraulic shovels, front-end loaders and mechanical trucks on 5-m-high benches.

Major Infrastructure and Equipment: Ore at Alamo Dorado is treated by conventional crushing and semiautogenous and ball mill grinding followed by thickening, agitated cyanide leaching, leach residue filtration and direct electrowinning to produce a cathode sludge; acidify, volatilise and reneutralise (AVR) cyanide recovery and recirculation; leach residue washing with AVR product solutions; dry stack tailings; and conventional silver and gold doré production from the melting of the cathode sludge.

The nominal design treatment rate is 4 000 t/d of ore on a 24-hour-a-day schedule, but Alamo Dorado regularly exceeds this processing rate.

Prospects: This year signals the beginning of a declining production profile at Alamo Dorado, as the operation begins to process more ore from the lower-grade stockpiles, while the mining operation depletes the last of the reserves over the next two years at higher effective strip ratios.

Contact Person: Country manager Chris Warwick.

Contact Details:
Pan American Silver,
tel +52 618 128-0709 ext 102,
fax +52 618-128-0692,
email info@panamericansilver.com, and
website http://www.panamericansilver.com.

Edited by Samantha Herbst
Creamer Media Deputy Editor

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